Research and Development Costs

Free CPA BAR (Business Analysis & Reporting) lesson in Technical Accounting and Reporting. 15 min read, ~2,304 words.

Expense all R&D costs as incurred (ASC 730-10-25-1); capitalization is the narrow exception, not the norm. Research seeks new knowledge; development translates that knowledge into a plan or design for a new or improved product or process. Alternative future use exception: capitalize assets (equipment, facilities, intangibles) only if usable in...