CAF-6 · Chapter 12 · Question 11 of 15
An entity cannot distinguish the research phase from the development phase of an internal project. Under IAS 38, the entity must treat all expenditure on that project as if it were incurred in:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) The research phase only.
Explanation
IAS 38 states that if an entity cannot distinguish the research phase from the development phase, it treats the expenditure as if it were incurred in the research phase only (i.e., it must all be expensed).
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