Final answer:
Software development costs incurred after achieving technological feasibility should be capitalized, not expensed or considered liabilities. R&D is essential for innovation, despite its uncertainty and political influence.
Step-by-step explanation:
When accounting for software, the expenditures made after the software is determined to be technologically feasible but before it is ready for commercial production should be capitalized as an intangible asset. This means the costs are not expensed as incurred nor are they treated as liabilities or written off as impaired at that stage. Instead, these costs are recorded on the balance sheet and then amortized over the software's useful life once it is available for public sale.
Research and development (R&D) plays a crucial role in advancing technology and production. Although R&D carries a significant level of uncertainty and can be influenced by both political and economic factors, it is an essential investment for firms to remain competitive. By investing in R&D, firms not only seek to generate future profits but also contribute to societal progress through technological spillovers that can inspire further innovation.