Godert Pharmaceutical Company has many scientists working in their labs trying to develop an anti-aging drug. The cost of this research and development must be:
A) expensed as incurred.
B) set up as an intangible asset and amortized over 20 years.
C) set up as an intangible and tested for impairment on a yearly basis
D) not be handled in any of the above ways.

Question

Quizplus · Accepted Answer

Research and development costs are typically expensed as incurred according to accounting standards, as there is uncertainty about the future economic benefits.

Godert Pharmaceutical Company Has Many Scientists Working in Their Labs