ABC Company incurred the following costs during the most recent fiscal year ended December 31st: Laboratory...
ABC Company incurred the following costs during the most recent fiscal year ended December 31st:
Laboratory research aimed at discovery of new knowledge $300,000
Cost to build a rough prototype model to test the research $65,000
Quality control during commercial manufacturing, including routine testing of products $220,000
Purchase price of testing equipment that will be used across all R&D projects over a 10 year life. This year's depreciation on this equipment is $10,000. $100,000
What is the total amount to be classified and expensed as research and development for the fiscal year ended December 31st?
Homework Answers
Total R&D cost = laboratory research cost + Cost to build prototype
= 300,000 + 65,000
= 365,0000
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