In accounting for research and experimental expenditures incurred in 2019,all of the following alternatives are available with the exception of
A)expense R&E costs in the year paid or incurred.
B)expense R&E costs in the year in which a product or process becomes marketable.
C)defer and amortize R&E costs as a ratable deduction over a period of 60 months or more.
D)capitalize and write off R&E costs only when the research project is abandoned or is worthless.

Question

Quizplus · Accepted Answer

The best choice is to expense R&E costs in the year paid or incurred. Option B is not available as per Generally Accepted Accounting Principles (GAAP) which do not allow expensing R&E costs in a year in which a product or process becomes marketable. Options C and D are also available but are not considered the best choices as they may not accurately reflect the expenses incurred in a particular year. Option A is the most commonly used method and is consistent with GAAP.

In Accounting for Research and Experimental Expenditures Incurred in 2019,all