Jalali,
I understand what you're saying here, but I'm not sure about the capitalized Product Development. Does this mean they spent $1,255,000 on the development of a product (Ardes2K, I guess), and instead of treating is as an expense, they now have 1.3 million worth of development on their books as an asset? If they don't sell any Ardes2K, what happens to this money? Does this amount get subtracted from sales of Ardes2K, or does it get depreciated? If it gets depreciated, how much and how quickly does it happen? I'm not an accountant, so any insight you (or anyone else) can share with me would be appreciated. Thanks. |
