Example of Research Cost

Example of Research Cost

Research cost is basically gaining the expert knowledge and therefore does not be treated as an asset; instead it is accounted for as expenses during the year.

Example of Research costs # 1

HR manager was given a task to perform a research of high turnover in telecommunication industry. The research is expected to include the following cost

Date Collection Costs	$ 5000
Printing &  Stationary	$ 2,000
Travelling Cost	$ 10,000

How the above cost will be accounted for in financial statement?

Solution

Rule: Research cost are accounted for as expense during the year

Date	Particulars	Dr.	Cr.
	Research Cost	$ 17,000
	Cash		$17,000