This R&D Capitalization Template is an useful tool to perform research & development capitalization and amortization calculations on a product.

How does this R&D Capitalization Template Work

Research and development (R&D) expenditures are required to be expensed by every company under the GAAP rules. Expensing R&D often results in a reduction in profits or even losses, as well as a lower return on assets (ROA) or return on invested capital (ROIC). To capitalize on R&D expenditures and value the assets, one should determine the total period of time a product or technology will create value or benefit. Once the amortization life of R&D expenses is identified, the company needs to find out the actual R&D expenses for each of those years and sum those up. Finally, the company can determine the amortization expenses using a straight-line method.
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