Part one of term paper
PURCHASED IN-PROCESS RESEARCH AND DEVELOPMENT When one company purchases another, it absorbs the acquired firm’s assets and liabilities onto its balance sheet. One part of the acquired company that belongs to neither area is in-process research and development. “Acquired in-process research and development (IPR&D) that is writte ...

Part two of term paper
... according to current accounting rules and standards, a company is allowed to write-off this part of the purchase price. The in-process technology can be a large factor in making the acquisition of a firm because reporting of earnings can be considerably influenced by the amount of purchase price allocated to an in-process R&D write-off. Effects on Future Periods Current and future results can be affected significantly by the allocation of the purchase cost of a business. When the acquired com ...