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NEW QUESTION: 1

A. Option D
B. Option B
C. Option C
D. Option A
Answer: D

NEW QUESTION: 2

A. TopicAm
B. Destination
C. Message
D. Language
E. Subject
F. Format
Answer: B,C,E

NEW QUESTION: 3
Which sort option should you use to add Temporary Values?
A. Descending
B. Adaptive Sort
C. Ascending
D. Custom Sort
Answer: D

NEW QUESTION: 4
Under the current US GAAP, the treatment of R&D expenses:
I. underestimates current income and leads to lower taxes.
II. leads to a more conservative balance sheet.
III. is tantamount to asserting that R&D outlays have no current benefits.
A. I, II & III
B. I only
C. I & II
D. none of these are correct
Answer: A
Explanation:
Explanation/Reference:
Explanation:
Difficulties in measuring the current value of assets being generated by R&D prevent a reliable application of the accrual principles, which require allocation of expenses in proportion to the current benefits generated. Hence, US GAAP takes the easiest solution of expensing all the R&D costs (unless they generate tangible or intangible assets which have alternative future uses which are measurable). Since R&D does generate future benefits on an expected basis, the full expensing of the costs when incurred tends to under-estimate current income and leads to lower taxes. Further, when the R&D activities do lead to profitable results, income gets overstated because of non-recognition of a portion of it in previous periods. Thus, R&D expensing adds volatility to income. On the other hand, expensing leads to a more conservative balance sheet since no assets or equity is recognized until the benefits actually materialize.
Thus, by assuming that current R&D has no current benefits, the GAAP accounting tries to prevent "bad" surprises.