A&J Company incurred the following expenses related to patented drugs. Legal fees in successful patent defense $ 25,000 Researcher salaries to develop drugs 87,000 Acquired a new patent 52,000 Research lab rent expense 8,000 Indicate costs that are reported as research and development expenses on the income statement. Indicate costs that are capitalized and reported in the Patent account on the balance sheet.
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A&J Company incurred the following expenses related to patented drugs.
Legal fees in successful patent defense | $ 25,000 |
---|---|
Researcher salaries to develop drugs | 87,000 |
Acquired a new patent | 52,000 |
Research lab rent expense | 8,000 |
- Indicate costs that are reported as research and development expenses on the income statement.
- Indicate costs that are capitalized and reported in the Patent account on the
balance sheet .
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- What is the total amount that Bryant Inc. should expense during the year (versus the company capitalizing the costs): 1. Purchased the cost of a patent from another company for $165,500. 2. Incurred $278,900 of Research and Development Costs. 3. Internal costs incurred to create a patent for $105,490. 4. Purchased a tradename for $97,300. 5. Goodwill from purchasing another division for $205,800.A company incurred the follow costs related to research and development for the current year: Technology development (salaries and supplies) $ 336,000 Engineering work performed by another company 166,000 Purchase of equipment 766,000 Testing new models 76,000 Legal fees for patent application 46,000 The equipment will be used in other projects. Depreciation in the current year is $106,000. For what amount should the company report research and development expense? Multiple Choice $524,000. $684,000. $730,000. $534,000.Befort Company filed for a patent on a new type of machine. The application costs totaled $15,000. R&D costs incurred to create the machine were $75,000. In the year in which the company filed for and received the patent, it spent $25,000 in the successful defense of a patent infringement suit. Required 1. At what amount should the company capitalize the patent? 2. What are the factors used to determine the economic life of a patent?
- During its first year of operation, Dovery Company incurred $355,000 of research costs undertaken with the prospect of gaining new technical understanding about a new nanotechnology procedure. An additional $495,000 was incurred to develop a production process to use that new technology to produce a new lubricant product. Under U.S. GAAP, which of the following is the appropriate accounting for these costs? Group of answer choices expense $355,000 and capitalize $495,000 as an intangible asset capitalize $850,000 as an intangible asset expense $850,000 expense $495,000 and capitalize $355,000 as an intangible assetThe Befort Company field for a patent on a new type of machine. The application costs totaled P12,000. R&D costs incurred to create the machine were P75,000. In the year in which the company filed for and received the patent, it spent P20,000 in the successfuldefense of a patent infringement suit. Required1. At what amount should the company capitalize the patent?2. How would you determine the economic life of the patent?Brill Company made the following expenditures during the current year: Costs to develop computer software for internal use in Brill’s general management information system: 1 000 000 Cost of market research activities 750 000 Brill Company’s total Expense?
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- Materials used in research and development projects $4,500 Equipment acquired that will have alternative future uses in future R&D projects for five years 1,500 Personnel costs of employees involved in R&D projects 5,500 Consulting fees paid to outsiders for R&D projects 2,800 Indirect costs reasonably allocable to R&D projects 250 Legal fees associated with registration of a patent resulting from a 2020 R&D project 2,500 Required: Compute the amount of R&D costs that should be classified as expenses in determining 2020 net income.$fill in the blank 1Smart Company incurred the following costs in 2021, in relation to developing a machine that will be used in manufacturing a product.Professional fees paid to consultants to conduct market study-----P 250,000Fees paid to engineers and experts for initial research-- 150,000Cost of equipment used for research. The equipment will be used for other research projects. The useful life of the equipment is 5 years----P300,000Legal fees to obtain patent---P100,000Licensing fees paid to the patent office --P 25,000Legal costs paid to defend patent against infringement suit --P 47,000What is the cost of patent?Smart Company incurred the following costs in 2021, in relation to developing a machine that will be used in manufacturing a product.Professional fees paid to consultants to conduct market study-----P 250,000Fees paid to engineers and experts for initial research-- 150,000Cost of equipment used for research. The equipment will be used for other research projects. The useful life of the equipment is 5 years----P300,000Legal fees to obtain patent---P100,000Licensing fees paid to the patent office --P 25,000Legal costs paid to defend patent against infringement suit --P 47,000How much is the total R&D expense