1.) During the current year, Think Company incurred costs to develop and produce a routine, low-risk computer software product. Completion of detailed program design 3,900,000; Costs incurred for coding and testing to establish technological feasibility 3,000,000; Other Coding costs after establishment of technological feasibility 7,200,000; Other testing costs after establishment of technical feasibility 6,000,000; Costs of producing product masters for training materials 4,500,000; Duplication of computer software and training materials from product masters (1,000 units) 7,500,000; and Packaging product (500 units) 2,700,000. In the year-end statement of financial position, what amount should be capitalized as software cost, subject to amortization?

a. 17,100,000

b. 20,700,000

c. 16,200,000

d. 17,700,000

2.) Stacy, Inc. provides an incentive compensation plan under which its president receives a bonus equal to 10% of the corporations income in excess of P900,000 before income tax but after deduction of the bonus. If income before income tax and bonus is P2,880,000 and the tax rate is 30%, the amount of the bonus would be *

a. 261,540

b. 288,000

c. 180,000

d. 198,000

3. On January 1, 2018, Samar Company paid P5,300,000 for property containing natural resource of 2,000,000 tons of ore. The present value of the estimated cost of restoring the land after the resource is extracted is P550,000 and the land will have a value of P650,000 after it is restored for suitable use. Tunnels, bunk houses, and other fixed installations are constructed at a cost of P8,000,000 and such expenditures are charged to mine improvements .Operations began on January 1, 2019 and resources removed totaled 600,000 tons. During 2020, a discovery was made indicating that available resource after 2020 will total 1,875,000 tons. At the beginning of 2020, additional bunk houses were constructed in the amount of P770,000. In 2020, only 400,000 tons were mined because of a strike. What amount should be the new depletion rate in 2020? *

a. 1.20

b. 1.60

c. 1.64

d. 1.94