This year Bauer Corporation incurs the following costs in development of new products: No benefits are realized from the research expenditures until next year.If Bauer Corporation elects to expense the research expenditures,the deduction is

Question

This year Bauer Corporation incurs the following costs in development of new products:  No benefits are realized from the research expenditures until next year.If Bauer Corporation elects to expense the research expenditures,the deduction is

Quizplus · Accepted Answer

Research expenditures cannot be capitalized and must be expensed. Therefore, the entire $175,000 cost must be expensed in the current year. There is no deduction available next year for research expenditures.

This Year Bauer Corporation Incurs the Following Costs in Development