Concerning computer software to be sold, leased, or otherwise marketed, which of the following costs are inventoriable and thus included in cost of goods sold?
A)maintenance and customer support costs
B)design, coding, and testing costs incurred before technological feasibility is established
C)costs of software developed for internal use
D)costs of disks, software duplication, and training materials

Question

Quizplus · Accepted Answer

Costs of disks, software duplication, and training materials are directly related to the production and delivery of the software product and can therefore be inventoried and included in the cost of goods sold. Maintenance and customer support costs are considered period costs and are expensed as incurred. Design, coding, and testing costs incurred before technological feasibility is established are also expensed as incurred. Costs of software developed for internal use are not related to the production and delivery of a software product for sale and are therefore expensed as incurred.

Concerning Computer Software to Be Sold, Leased, or Otherwise Marketed