Question

How treated in research and development cost in intangible assets?

Answer 1

Answer:

Research and development costs no longer appear as intangible assets on the balance sheet. The Board applies the same line of reasoning to other costs associated with internally generated intangible assets, such as the internal costs of developing a patent. When a company spends money on R&D, whether through purchased services or through its own R&D department, it must record the cost as an expense in the period incurred. Under GAAP, the company must expense the R&D cost and report it on the company's current income statement.

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