Q34.Two company are identical except for their accounting treatment of research and development costs, One company expenses all costs immediately, while the other company capitalizes a portion of the costs. Compared to the company that capitalizes costs, the company that expenses immediately will most likely:

A. earn a lower return on assets.

B. Have lower financial leverage.

C. Exhibit a smoother pattern of net income over time.

D. Report lower cash flow from operations in the statement of cash flows.

答案和详解如下：

Q34.   D   Study Session 9-42.a,b

Company that capitalize research and development costs report those expenditures in the investing activities section of the statement of cash flow; companies that expense research and development costs report those expenditures in cash flow from operations.

a

thx

a