Which of the following is the required treatment of research and development costs under international accounting rules?

Question

Quizplus · Accepted Answer

Under international accounting rules, research costs should be expensed as incurred because their outcomes are highly uncertain. However, development costs should be capitalized if certain criteria are met, such as the technical feasibility of completing the project, the intention to complete it, ability to use or sell the product, and the availability of resources to complete the project. Therefore, the best option is C, which recognizes the different treatment of research costs and development costs.

Which of the Following Is the Required Treatment of Research