IFRS Requires That Firms Expense Costs During a Research Phase

question 7

Multiple Choice

IFRS requires that firms expense costs during a research phase but allows firms to capitalize development-phase costs under certain conditions.Under IFRS,which of the following is not a condition that must be met for a firm to capitalize development-phase expenditures?

• A)The company can reliably identify the research costs incurred to bring the project to economic feasibility.
• B)The company can reliably identify the development costs incurred to bring the project to economic feasibility.
• C)The project has achieved technical feasibility.
• D)The company intends to complete the project and either use or sell the intangible asset.

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Definitions:

Manufacturers

Companies or individuals that produce finished goods from raw materials through the use of various processes.

Government Agencies

Organizations established by a government to implement policy, enforce laws, and oversee specific areas of public administration.

Offering Available

Offering available denotes the range of products or services that a business makes accessible to its customers.

Consumers

Individuals or groups who purchase goods and services for personal use.