Scenario D. Mustafa has begun the planning process for his entrepreneurial venture. He has completed an assessment of his vision to operate a home-care service for the elderly, for which he feels there is a strong market. He has a good understanding of the availability of his own resources and his personal ability to manage the business. Now he is prepared to start compiling functional plans for marketing, finance, and human resources so that he can obtain the financing he will need to start. He is also contemplating how to develop the right reputation and create the proper networks to find employees and customers as well as get advice from fellow businesspeople.

Trecek corporation incurs research and development costs of $625,000 in 2017, 30 percent of which relate to development activities subsequent to ias 38 criteria having been met that indicate an intangible asset has been created. the newly developed product is brought to market in january 2018 and is expected to generate sales revenue for 10 years. assume that a u.s.–based company is issuing securities to foreign investors who require financial statements prepared in accordance with ifrs. thus, adjustments to convert from u.s. gaap to ifrs must be made. ignore income taxes. required: (a) prepare journal entries for research and development costs for the years ending december 31, 2017, and december 31, 2018, under (1) u.s. gaap and (2) ifrs. (c) prepare the entry(ies) that trecek would make on the december 31, 2017, and december 31, 2018, conversion worksheets to convert u.s. gaap balances to ifrs.