Maribeth Company made the following expenditures relating to Product Zee: Legal costs to file a patent on Product Zee. Production of the finished product would not have been undertaken without the patent Special equipment to be used solely for development of Product Zee. The special equipment has no other use and has an estimated useful life of four years Labor and materials costs incurred in producing a prototype model Cost of testing the prototype 100,000 600,000 2,000,000 800,000 What total amount of costs should be expensed when incurred? A. 2,800,000 B. 2,950,000 С. 3,400,000 D. 3,500,000
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- Immortality Co. made the following expenditures relating to a newly invented product Legal and registration costs related to a patent on the product 120,000Special equipment used solely on R&D activities for the newly invented product 720,000Depreciation on the special equipment above 180,000Labor and material costs incurred in producing a prototype model 2,400,000Cost of testing the prototype 960,000 Required:What is the total amount of costs that will be expensed when incurred?8. Maribeth Company made the following expenditures relating to Product Zee: Legal costs to file a patent on Product Zee. Production of the finished product would not have been undertaken without the patent 100,000 Special equipment to be used solely for development of Product Zee. The special equipment has no other use and has an estimated useful life of four years Labor and materials costs incurred in producing a prototype model Cost of testing the prototype What total amount of costs should be expensed when incurred? А. 2,800,000 600,000 2,000,000 800,000 В. 2,950,000 С. 3,400,000 D. 3,500,000. Squarepants company made the following expenditures relating to product Y.Legal costs to file a patent on Product Y. Production of the finishedProduct would not have been undertaken without the patent 75,000Special equipment to be used solely for the development of Product YThe equipment has no other use and has an estimated useful life of 4 yrs 450,000Labor and materials costs incurred in producing a prototype 1,500,000Cost of testing the prototype 600,000 What total amount should be expensed when incurred?
- Outspoken Company made the following expenditures relating to Product Y. Legal costs to file a patent on Product Y. Production of the finished product would not have been undertaken without the patent Special equipment to be used solely for development of Product Y. The equipment has no other use and has an estimated useful life of four years. Labor and material costs incurred in producing a prototype Cost of testing the prototype - 100,000 600,000 2,000,000 800,000 What total amount should be expensed when incurred? a. 2,800,000 b. 2,950,000 c. 3,400,000 d. 3,500,000Build Limited plans to start a project (Project Beta) for the forthcoming yearthat will be sold to an international corporation. Build Limited is yet to pay for the research costs to date, which total Rs. 150,000. The following additional costs have been estimated by the managing director to complete project Beta. MaterialsTwo materials are needed for project Beta – Material A and Material B. Material A has already been purchased at a cost of Rs. 60,000. It is toxic; and if not used in project Beta, it must be disposed of at a cost of Rs. 5,000. Material B – there are 50 kgs available in inventory which has been purchased at Rs. 400 per kg. project Beta will require a total of 150 kgs of this material. The current purchase price if Rs. 450 per kg and this material is regularly used in other projects currently undertaken by Build Limited. LabourProject Beta will require skilled labour which is hard to recruit in the present situation. Workers will have to be transferred from another…A manufacturer incurs the following costs: $38,000 developing new techniques that will be put in place shortly to cut production costs; $27,000 researching a new process to improve the quality of the standard product and $8,000 on market research into the commercial viability of a new type of product. It is company policy to capitalise costs whenever permitted by IAS 38 Intangible Assets. 9.7 How much should be charged as research and development expenditure in profit or loss? (ignore amortisation) $73,000 $35,000 $27,000 $38,000 A 229ni2ud a yde C BPP EARNING MEDIA
- Rust Industrial Systems Company is trying to decide between two different conveyor belt systems. System A costs $350,000, has a 4-year life, and requires $141,000 in pretax annual operating costs. System B costs $430,000, has a 6-year life, and requires $135,000 in pretax annual operating costs. Both systems are to be depreciated straight- line to zero over their lives and will have zero salvage value. Whichever project is chosen, it will not be replaced when it wears out. The tax rate is 22 percent and the discount rate is 8 percent. Calculate the NPV for both conveyor belt systems. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) System A System B Which conveyor belt system should the firm choose? ○ System B O System AWolfe Assembly Masters developed a new cost- and time-efficient assembly process that would be advantageous to many manufacturing companies. To protect their process, they applied for and obtained a patent. Which of the following costs associated with the assembly process should Wolfe amortize as an intangible asset? $12,000 in disposal fees to remove hazardous waste collected during research and development $1.56 million in development costs to develop the process $37,000 to apply for a patent for the process $914,000 in research costs to learn about the processAstrolech Semiconductor incurred the following costs in 2021 related to a new product design: Research for new semiconductor design Development of the new product Legal and filing fees for a patent for the new design $3,720,000 906, 000 115, 000 $4,741,000 Tetal The development costs were incurred after technological and commercial feasibility was established and after the future eco benefits were deemed probable. The project was successfully completed, and the new product was patented before the ene 2021 fiscal yeat Required: 4 Calculate the amount of research and development expense (R&D) AstroTech should eport in its 2021U.S. GAAP income related to this project. 2. Repeat Requirement 1 assuming that Astroledh prepates its financial statements according to International Eimancial Repe Standards (IFRS). Research and development expense under U S. GAAP Research and development expense under IFRS
- . Milby company incurred the following research and development costs during the current year: Equipment purchased for current and future projects 150,000Equipment purchased for current project only 300,000Research and development salaries of current project 600,000Legal fees to obtain patent 75,000 Material and labor costs for prototype product 900,000 The equipment has a five-year useful life and is depreciated using the straight line method. What total amount should be recognized as research and development expense for current year?Rust Industrial Systems is trying to decide between two different conveyor belt systems. System A costs $276,000, has a four-year life, and requires $84,000 in pretax annual operating costs. System B costs $390,000, has a six-year life, and requires $78,000 in pretax annual operating costs. Both systems are to be depreciated straight-line to zero over their lives and will have zero salvage value. Suppose the company always needs a conveyor belt system; when one wears out, it must be replaced. Assume the tax rate is 24 percent and the discount rate is 8 percent. Calculate the EAC for both conveyor belt systems. Note: Your answers should be negative values and indicated by minus signs. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. System A System B Which conveyor belt system should the firm choose? System A System BDuring the current year, Beta Company incurred the following costs related to a new solar-powered car: Salaries of laboratory employees researching how to build the new car 2,500,000 200,000 Legal fees for the patent application for the new car Engineering follow-up during the early stage of commerical production during the current year Marketing research to promote the new car Design, testing and construction of a prototype 500,000 300,000 4,000,000 What amount should be reported as research and development expense? a. 7,500,000 b. 6,500,000 C. 2,500,000 d. 7,200,000