C is corrent. Per ASC Topic 915, a development stage company shall use the same generally accepted accounting principles that apply to established operating enterprises to govern the recognition of revenue and to determine whether a cost is to be capitalized or expensed as incurred. Accordingly, capitalization or deferral of costs shall be subject to the same assessment that would be applicable in an established operating enterprise. Thus, deficits accumulated during the development stage would not be capitalized, rather they will be reported as part of stockholders’ equity.
A is incorrect. Refer to the correct answer explanation.
A is incorrect. Refer to the correct answer explanation.
D is incorrect. Refer to the correct answer explanation.
|
