[MrsBing]

If a company purchases software, then a few years later is given the source code for free in order to make changes to the software, how would the source code be accounted for? How would it be accounting for if the source code was purchased?

Would it matter if it’s determined the source code will never be used?

Becker, Wiley Test Bank, and Ninja 10 Point Combo!

FAR: 89
REG: 87
AUD: 92
BEC: 75
Ethics: 90

Licensed Arizona CPA

[Determined CPA]

MrsBing!! Long time no chat!!!!!! You've been MIA since passing BEC!

Sorry I cant help with your question LOL but wanted to say HI!

A - 75
B - 78 God is good.
F - 77 Answered prayers.
R - 84! Done!!

Paperwork sent - waiting for license!!
Still on a cloud and in shock. Through God, all things will happen.

[MrsBing]

Yeah, after I found out I passed the last exam I wanted nothing to do with anything CPA related for a while :). Now, I'm back occasionally browsing the forum and trying to remember some of the stuff I learned.

Becker, Wiley Test Bank, and Ninja 10 Point Combo!

FAR: 89
REG: 87
AUD: 92
BEC: 75
Ethics: 90

Licensed Arizona CPA

[Gatorbates]

My thinking: If received for free, you'd have to get a fair estimated value of the source code. Book a JE adding the amount to the original software purchased, and crediting Gain or Rev.

If purchased, pretty much the same thing, except the credit would be cash/AP and the difference between the estimated value and the amount paid would be Gain/Loss.

Licensed Florida CPA:
B: 71, 73, 79
A: 83
R: 78 (expired), 77
F: 74, 74, 80

It's finally freaking over.

[MrsBing]

If the source code will never be used, should it be written off?

Becker, Wiley Test Bank, and Ninja 10 Point Combo!

FAR: 89
REG: 87
AUD: 92
BEC: 75
Ethics: 90

Licensed Arizona CPA

[Author]

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