Question

Research and development costs:____________

a. Generally pertain to activities that occur prior to the start of production.
b. May be expensed or capitalized, at the option of the reporting entity.
c. Must be capitalized and amortized.
d. None of these responses are correct.

Answer 1

b. May be expensed or capitalized, at the option of the reporting entity.

Step-by-step explanation:

The research and development cost is the cost that are incurred for researching and developing a new product, new process, new project

It may be expense or it may be capitalized. Its totally depend on the management of the firm decisions

Therefore the option b is correct and the same is to be considered