Indicate whether the items below are to be capitalized as an intangible asset or expensed.

Which account(s) would each item be recorded to?

a. Salaries of research staff

b. Costs to test prototypes

c. Borrowing costs for development of a qualifying intangible asset

d. Executive salaries for time spent on development of an intangible asset

e. Costs to launch a new product

f. Purchase cost of a patent from a third party g. Product research costs h. Costs internally incurred to create goodwill i. Legal costs to successfully defend a patent j. Purchase price of new software k. Training costs for new software l. Direct costs of special programming needed when purchasing new software m. Costs incurred in forming a corporation for purposes of commercializing a new product n. Operating losses incurred in the start-up of a business to manufacture a patented produce o. The purchase cost of a franchise p. The cost of developing a patent q. The cost of purchasing a patent from an inventor r. Legal costs incurred in securing a patent s. The cost of purchasing a copyright t. Product development costs u. Consulting fees paid to a third party for advice on a research project v. The cost of an annual update on payroll software w. Interest or borrowing costs specifically identifiable with an internally developed intangible asset x. Materials consumed in the development of a product at the manufacturing stage for an IFRS company y. Materials consumed in research projects z. General borrowing costs on the company’s line of credit aa. Indirect costs allocated to research and development projects