In Accounting for Research and Experimental Expenditures Incurred in 2018

question 1092

Multiple Choice

In accounting for research and experimental expenditures incurred in 2018, all of the following alternatives are available with the exception of

• A) defer and amortize R&E costs as a ratable deduction over a period of 60 months or more.
• B) expense R&E costs in the year paid or incurred.
• C) expense R&E costs in the year in which a product or process becomes marketable.
• D) capitalize and write off R&E costs only when the research project is abandoned or is worthless.

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Definitions:

Accelerated Depreciation

A method of depreciation in which an asset loses value at a faster rate in the initial years of its life, often used to reflect higher usage or obsolescence.

Municipal Obligations

Debts issued by municipalities, often in the form of bonds, to finance public projects such as roads and schools.

FASB Conceptual Framework

A set of objectives and fundamentals developed by the Financial Accounting Standards Board to guide the creation of accounting standards.