Website Development CostsApplying the Codification, plus Consideration of Original Standards Jenny and

Jim have created a new website that they think will help families share photos more easily, create calendars and photo

books, and share and edit family videos. Hoping their new site will go viral, Jenny and Jim named their new company

PhotoShare, Inc. and are preparing their first financial statements as required by their investors. Jenny and Jim have

incurred the following costs to develop their website:

$1 million to create the web platform capable of storing photos and allowing multiple users to view and edit photos

$100,000 for website design, including the photo that appears on the homepage and the placement of each tab and link

$50,000 to content writers, who wrote the Welcome screen message, plus who wrote instructions for users on how to use the site

1. Using only the Codification, research whether Jenny and Jim should treat each cost as an asset or expense on

the companys financial statements. Include excerpts as helpful in supporting your responses.

2. Next, locate the source document (the FASB Statement, EITF Issue, or ASU, for example) that gave rise to the

Codification guidance you located. How does the information in this source document confirm, revise, or change

your interpretation of the Codification? Explain

Textbook: Textbook: Skills for Accounting Research, 3e FASB Codification and eIFRS , 3rd edition, Shelby Collins ISBN: 978-1-61853-177-3, Copyright 2016.