Which of the following is not an implication of the going-concern assumption?
A) The historical cost principle is credible.
B) Depreciation and amortization policies are justifiable and appropriate.
C) The current/noncurrent classification of assets and liabilities is justifiable and significant.
D) Amortizing research and development costs over multiple periods is justifiable and appropriate.

Question

Quizplus · Accepted Answer

The going-concern assumption implies that a company will continue to operate in the foreseeable future, which justifies spreading costs like depreciation over time. However, research and development costs are typically expensed as incurred, not amortized over multiple periods, due to uncertainty in future benefits.

Which of the Following Is Not an Implication of the Going-Concern