Research costs incurred by a company should be:

Question

Quizplus · Accepted Answer

Research costs are considered to be expenses rather than assets, and therefore they should be expensed on the current year's income statement. This is in line with the matching principle in accounting, which requires that expenses be recognized in the same period as the revenues they helped to generate. Capitalizing and amortizing research costs over a period of years is not appropriate, as these costs are not expected to generate future economic benefits beyond the current year.

Research Costs Incurred by a Company Should Be