Galvora has recognised as an asset 30,000 of set-up costs for a production line dedicated to a customer. These costs relate to the 1,000,000 units components to be delivered under the current contract and a specifically identified anticipated contract. Galvora judges that amortisation based on the units delivered reflects the pattern of transfer of the components to the customer. In 20X1, 250,000 units components are delivered. Record the amortisation entry for 20X1.
- Set-up costs recognised as an asset
- 30,000
- Components to be delivered (current and anticipated contracts)
- 1,000,000
- Components delivered in 20X1
- 250,000