Which of the following statements is not applicable to contract acquisition costs under ASC Topic 606 guidance for revenue recognition? Incremental costs of acquiring a contract must be capitalized and amortized over the life of the contract. Costs that would be incurred regardless of whether a contract is obtained are not capitalized. The capitalization requirement is subject to a practical expedient. Costs must be capitalized even if the amortization period is one year or less.

In the given case all of the following statements is applicable to contract acquisition costs under ASC Topic 606 guidance for revenue recognition:: Costs which increases the life of such asset should be Amortized over the useful life of the asset and Amortized accordingly.. Other revenue expenditure incurred for maintaining should be expensive in the statement of profit and loss account in the books of the assessee... The following statements are true with regards to contract revenue recognition... Incremental costs of acquiring a contract must be capitalized and amortized over the life of the contract. Costs that would be incurred regardless of whether a contract is obtained are not capitalized. The capitalization requirement is subject to a practical expedient. Option Costs must be capitalized even if the amortization period is one year or less is incorrect statement as they are to be Expensed of in the profit and loss statement as an expense incurred during the year.....

Answered: Which of the following statements is…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Which of the following statements is not applicable to contract acquisition costs under ASC Topic 606 guidance for revenue recognition?

Incremental costs of acquiring a contract must be capitalized and amortized over the life of the contract.
Costs that would be incurred regardless of whether a contract is obtained are not capitalized.
The capitalization requirement is subject to a practical expedient.
Costs must be capitalized even if the amortization period is one year or less.

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