When determining whether an internally developed intangible asset should be recognized, the process of generating the intangible is usually broken down into the
A) research and financing elements.
B) acquisition and disposal stages.
C) exploitation and disposal stages.
D) research and development phases.

Question

Quizplus · Accepted Answer

The process of generating an internally developed intangible asset is typically broken down into the research and development phases. This is because the research phase represents the activities undertaken to create new knowledge, while the development phase represents the activities undertaken to apply this new knowledge to create a new or improved product, process, or service. Therefore, recognizing an internally developed intangible asset requires identification and measurement of the expenditure incurred during these two distinct phases.

When Determining Whether an Internally Developed Intangible Asset Should Be