Reference no: EM132965515

Problem 1: Which of the following costs should be excluded from research and development expense?

a. Modification of the design of a product

b. Acquisition of R & D equipment for use on a current project only

c. Cost of marketing research for a new product

d. Engineering activity required to advance the design of a product to the manufacturing stage

Problem 2: If a company constructs a laboratory building to be used as a research and development facility, the cost of the laboratory building is matched against earnings as

a. research and development expense in the period(s) of construction.

b. depreciation expense as part of research and development costs.

c. depreciation or immediate write-off depending on company policy.

d. an expense at such time as productive research and development has been obtained from the facility.