Question: WEBDESIGN Ltd. decided that it needed to update its computer programs for its supplier relationships. It purchased an off-the-shelf program and modified it internally to

WEBDESIGN Ltd. decided that it needed to update its computer programs for its supplier relationships. It purchased an off-the-shelf program and modified it internally to link it to 'WEBDESIGN's other programs. The following costs may be relevant to the accounting for the new software:
Net carrying amount of old software ............... $1,100
Purchase price of new software ................. 5,900
Training costs ........................ 4,550
General and administrative costs ................ 3,750
Direct cost of in-house programmer's time spent on conversion ... 1,720
Prepare journal entries to record the software replacement.

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