U.S. GAAP Codification of Accounting Standards

U.S. GAAP Codification   Accounting Standards, ASC

U.S. GAAP Codification of Accounting Standards
Codification Topic 985-20: Costs of software to be sold, leased, or marketed


U.S. GAAP Codification Updates
Principles of Accounting Intermediate Accounting Advanced Accounting
Accounting Terms


Codification Topic 985-20
Costs of software to be sold, leased, or marketed


Accounting Rules about Software

asc 985-20: Costs of Software to Be Sold, Leased, or Marketed
--> SFAS 86, August 1985
--> "Accounting for the Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed"

asc 985-605: Software Revenue Recognition
--> AICPA SOP 97-2
--> "Software Revenue Recognition"

asc 350-40: Internal-Use Software
--> AICPA SOP 98-1
--> "Accounting for the Costs of Computer Software Developed or Obtained for Internal Use"

Two points on the timeline:
(A) When the technological feasibility is established
(B) When the product is available for general release to customers

Costs of software to be sold
1. Up to (A) --> expensed
2. After (A) up to (B) --> capitalized
3. After (B) --> expense

Costs of purchased software
1. Software that has alternative future use 
--> capitalized
2. Software without alternative future use 
--> treated same as internal development costs

Capitalized software costs
1. Amortized on a "product-by-product" basis
2. Amortization starts at (B)
3. Amortization amount is the higher of (1) or (2)
(1) straight-line method amortization
(2) amount based on the ratio of current revenue and total expected revenue

Impairment test
1. If (a) is less than (b), (b) is written down to (a)
(a) net realizable value of the product
(b) unamortized balance
2. The difference is recognized as an expense
3. Write-down is not reversed in subsequent periods





Other Topics at the Codification 900
Accounting Standards Codification, ASC, Overview
 
ASC Codification Topic 905: Agriculture
ASC Codification Topic 908: Airlines
 
ASC Codification Topic 910: Contractors
ASC Codification Topic 915: Development stage entities
 
ASC Codification Topic 920: Entertainment
 
ASC Codification Topic 930: Extractive activities
 
ASC Codification Topic 940: Financial services
 
ASC Codification Topic 952: Franchisors
ASC Codification Topic 954: Health care entities
ASC Codification Topic 958: Not-for-profit entities
 
ASC Codification Topic 960: Plan accounting
 
ASC Codification Topic 970: Real estate
 
ASC Codification Topic 980: Regulated operations
ASC Codification Topic 985: Software
 
ASC Codification Topic 995: U.S. steamship entities

 

   U.S. GAAP Codification of Accounting Standards
Accounting Standards Codification, ASC, Overview
ASC Codification 200: Presentation
ASC Codification 300: Assets
ASC Codification 400: Liabilities
ASC Codification 500: Equity
ASC Codification 600: Revenue
ASC Codification 700: Expenses
ASC Codification 800: Broad Transactions
ASC Codification 900: Industry

U.S. GAAP by Topic
Accounting Topics








Copyright © CPAClass.comTM  All Rights Reserved.