AGA Examination 2: Governmental Accounting, Financial Reporting and Budgeting (GAFRB) GAFRB Question # 16 Topic 2 Discussion

AGA Examination 2: Governmental Accounting, Financial Reporting and Budgeting (GAFRB) GAFRB Question # 16 Topic 2 Discussion

GAFRB Exam Topic 2 Question 16 Discussion:
Question #: 16
Topic #: 2

The Department of the Interior has the following costs associated with the development of a new visitor tracking system.

Research cost determining if system should be internally or externally developed $100,000

Software configuration and system development $750,000

Cost of testing the new system for fiscal usage $225,000

Converting data from old tracking system to new tracking system $500,000

How much should be capitalized as the cost of the asset?


A.

$750,000


B.

$975,000


C.

$1,475,000


D.

$1,575,000


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