Firms that incur research and development costs to develop a patented product:
A)must expense the costs as incurred.
B)must capitalize the costs and only reduce such costs if the patent becomes impaired.
C)must capitalize the costs and then amortize the costs over the expected economic life of the patent.
D)have a choice either to expense the costs as incurred or capitalize the costs and amortize the costs over the legal life of the patent.
E)have a choice either to expense the costs as incurred or capitalize the costs and amortize the costs over the expected economic life of the patent.

Question

Quizplus · Accepted Answer

The Answer of Firms that incur research and development costs to develop a patented product:
A)must expense the costs as incurred.
B)must capitalize the costs and only reduce such costs if the patent becomes impaired.
C)must capitalize the costs and then amortize the costs over the expected economic life of the patent.
D)have a choice either to expense the costs as incurred or capitalize the costs and amortize the costs over the legal life of the patent.
E)have a choice either to expense the costs as incurred or capitalize the costs and amortize the costs over the expected economic life of the patent.

Firms That Incur Research and Development Costs to Develop a Patented