The successful-effort method of accounting for pre-production costs does not:
A) Permit the carrying forward of any exploration and evaluation costs.
B) Match the total costs of exploration and evaluation against the revenue arising from the few successful projects.
C) Prohibit the creation of reserves to smooth income by delaying the recognition of expenses and matching them against unrelated revenues.
D) Involve the immediate write-off of any exploration and evaluation costs.
E) All of the given answers.

Question

Quizplus · Accepted Answer

The Answer of The successful-effort method of accounting for pre-production costs does not:
A) Permit the carrying forward of any exploration and evaluation costs.
B) Match the total costs of exploration and evaluation against the revenue arising from the few successful projects.
C) Prohibit the creation of reserves to smooth income by delaying the recognition of expenses and matching them against unrelated revenues.
D) Involve the immediate write-off of any exploration and evaluation costs.
E) All of the given answers.

The Successful-Effort Method of Accounting for Pre-Production Costs Does Not