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17 October, 23:23

Partnership incurred $15,000 of organizational costs and $75,000 of startup costs in 2011. JKL may deduct $5,000 each of organizational and startup costs, and the remaining costs ($10,000 of organizational costs and $70,000 of startup costs) may be amortized over 180 months.

True or False

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  1. 17 October, 23:50
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    False

    Explanation:

    The cost incurred to startup the business before realization of benefit from the business is called startup cost.

    On the other hand organization cost ia a cost which is incurred to organize the business operations.

    Startup cost can be amortized over a specific period of time. But the organizational cost is charged when it is incurred, it can not be amortized.
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