Computer Software Costs
Costs incurred in creating computer software are considered R&D until the product has been proved to be technologically feasible.
Costs incurred up to this point are expensed as incurred.
After the working program has been developed, all software production costs are recorded as assets and amortized over the estimated economic life of the product using the straight-line method.
Software developed for internal use by a company may be amortized over its estimated useful life.