What Is the Test for Deferral of Research Costs as Required

question 16

Multiple Choice

What is the test for deferral of research costs as required by AASB 138?

• A) Research costs can be deferred (recorded as an asset) when it is probable that the project they are applied to will bring future economic benefits.
• B) Research costs may not be deferred unless it is almost certain that the project they are applied to will bring future economic benefits.
• C) Research costs may not be recorded as an intangible asset.
• D) Research costs may be deferred if the entity can demonstrate that an intangible asset exists and that it will generate future economic benefits.
• E) Research costs may be recorded as an intangible asset if the company intends to develop the product further.