Under IFRS, costs in the development phase are
A) never capitalized, but expensed as they are under U.S. GAAP.
B) capitalized if they exceed development phase costs incurred for previously successful ventures.
C) capitalized once technological feasibility is achieved.
D) capitalized on an interim basis, but then expensed prior to the end of the company's fiscal year.

Question

Quizplus · Accepted Answer

Under IFRS, costs in the development phase are capitalized once technological feasibility is achieved. This is different from U.S. GAAP, which generally does not allow the capitalization of development costs. Option A is incorrect as it states that costs in the development phase are always expensed under IFRS, which is not correct. Option B is incorrect as it mentions the comparison with previously successful ventures, which is not relevant for capitalization of development costs under IFRS. Option D is incorrect as it mentions an interim basis for capitalization, which is not applicable under IFRS.

Under IFRS, Costs in the Development Phase Are