Research costs cannot be capitalized development

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Unformatted text preview: value. USA Recorded at acquisition cost. Goodwill is recorded as an asset only if it is purchased (goodwill is the excess of the purchase price over the fair value of the net assets that are purchased). According to ARR 9, an internally generated intangible may be recognized as an asset when the following criteria are satisfied: - The intangible item can be separately identified; - It will generate future economic benefits over several years; - Its cost can be measured reliably; - Adequate resources exist, or are reasonably certain to be available to complete the item and to market or use it. Research costs cannot be capitalized. Development costs are considered by ARR 9 as intangible assets. Recognition criteria are the same as for other intangibles. If a separate intangible asset (e.g. patent) can be identified, and if it has a determinable useful life, it can be capitalized as a separate intangible asset. Development costs are expensed as incurred under US GAAP. However, separate rules apply to development costs for computer software that...
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