hard · CFA Level I fsa

Amberfen Pharma incurred $200 million in costs for its 'Project Aurora.' This includes $120 million in the research phase and 80 million in the development phase after technical and commercial feasibility was established. Amberfen reports under IFRS.

What is the impact on the Fixed Asset Turnover ratio in the year development costs are capitalized?

  1. The ratio will be lower.
  2. The ratio will be higher.
  3. The ratio is unaffected.

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