The Costs-Written-Off Method Is To

question 64

Multiple Choice

The costs-written-off method is to:

• A) write off all exploration and evaluation costs and not reinstate them if economically recoverable reserves are subsequently discovered.
• B) write off all evaluation and development costs unless it is considered likely that economically recoverable reserves will be identified within the next financial period.
• C) write off all exploration and evaluation costs but reinstate them if economically recoverable reserves are subsequently discovered.
• D) write off all deferred exploration and development costs as soon as it is determined that the reserves in the area of interest are not economically recoverable.

---

Definitions:

Past Due Taxes

Taxes that have not been paid by the date they are due, potentially incurring penalties and interest.

Title Search

An examination of public records to confirm a property’s legal ownership and find out what claims or liens are on the property.

Salvage Proceeds

The amount of money received from selling an asset after its useful life is over or it has been damaged beyond repair.

Start-Up Costs

Expenses incurred during the process of establishing a new business or project.