Aston Ltd acquires new energy efficient technology that will significantly reduce its energy costs for

Cost of new solar technology 1500000

Trade discount provided 200000
Training course for staff in new technology 70000
Initial testing of new technology 20000
Losses incurred while other parts of plant shut down during testing and training 30000

The cost that can be recognised and capitalised is:

Cost for capitalized 1500000
New of solar technology (20000)
Initial testing of new technolog 1520000
duce its energy costs for manufacturing. Costs incurred include:
Net asset at acquisition date
Cost capitalized 10000000
Adjustment
- medical research (3000000)
- medical research performed for client (1000000)
- cost for training (500000)
- advertising campaign (2200000)
- license 3000000
- other net assets 20000000
Adjusted net assets 26300000
Cost for capitalized
b, Recipes, secret formulas, models and designs, prototype
h Goodwill purchased in a business combination
i A company-developed patented drug approved for medical use
j, A license to manufacture a steroid by means of a government grant
 Required

1/1/x1 DR Taxi license 10000

CR Cash 10000

31/12/x1 DR Depreciation expense 2000

CR Accumulated amortization 2000

31/12/x2 DR Depreciation expense 2000

CR Accumulated amortization 2000

Accumulated armotization = 4000

>>> Carrying amount of license 6000
If the company performs a license reassessment, then

Compare Fair value (in this case is 12000)

with CA = 6000
Asset Increased 6000

31/12/x2 DR Taxi license 6000

CR Revaluation surplus 6000