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A company development a technology to enhance the battery life of mobile phones. the cost of development hace been capitalized as an intangible asset at 500000 the company estimate the life of technology to be 3 years?
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A company development a technology to enhance the battery life of mobi...
Intangible Asset Development Cost
The cost of developing the technology to enhance the battery life of mobile phones has been capitalized as an intangible asset at $500,000. This cost includes all the expenses incurred in creating and developing the technology.

Estimated Life of Technology
The company estimates the life of the technology to be 3 years. This means that the technology is expected to provide benefits and generate revenue for the company over a period of 3 years.

Capitalization of Development Costs
When the cost of developing an intangible asset meets certain criteria, it can be capitalized rather than expensed. In this case, the company has determined that the technology meets the criteria for capitalization as an intangible asset.

Amortization of Intangible Asset
Since the estimated life of the technology is 3 years, the company will amortize the intangible asset over this period. This means that the cost of development will be gradually expensed over the 3-year period, reflecting the consumption of the asset's economic benefits.

Impact on Financial Statements
By capitalizing the development cost as an intangible asset and amortizing it over 3 years, the company will spread out the expense recognition and match it with the revenue generated by the technology. This will result in a more accurate representation of the company's financial performance and position in its financial statements.
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A company development a technology to enhance the battery life of mobile phones. the cost of development hace been capitalized as an intangible asset at 500000 the company estimate the life of technology to be 3 years?
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A company development a technology to enhance the battery life of mobile phones. the cost of development hace been capitalized as an intangible asset at 500000 the company estimate the life of technology to be 3 years? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A company development a technology to enhance the battery life of mobile phones. the cost of development hace been capitalized as an intangible asset at 500000 the company estimate the life of technology to be 3 years? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A company development a technology to enhance the battery life of mobile phones. the cost of development hace been capitalized as an intangible asset at 500000 the company estimate the life of technology to be 3 years?.
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