Digitex limited acquired an intellectual property at the cost of 70,00,000 (at the beginning of the year) and it meets the definition of intangible…

Digitex limited acquired an intellectual property at the cost of 70,00,000 (at the beginning of the year) and it meets the definition of intangible asset as per AS 26. As per the calculations made by the Company, the benefit from this intellectual property will accrue for next 5 years wherein for first year will be 30%, for next two years it will be 25% each and 10% for the next 2 years. Year 2 The Company incurred development cost for its new product and incurred - 25,00,000 (at the beginning of the year) and was of the view that it will get the benefits for the next 5 years. Year 3 During the year, it was found that due to change in government policies, no further benefits will be available to the Company from development cost. Year 4 At beginning of year 4 it was found that the remaining 20% benefit from intellectual property will flow to the Company in this year itself. Answer the following questions on the basis of above information: