Carmanah Industries Ltd$.$ Is a company in the high$-$technology industry. Carmanah has been working on developing a new solar panel technology. The technology meets all of the six criteria required in order to capitalize development costs. During $2023,$ Carmanah incurred the following costs related to research and development:

Cost of equipment acquired for use in research and development projects over the next five years $($straight$-$line depreciation used

Rent of facility $q,$

Salaries of research staff $q,$

Legal costs to obtain new patent for technology $q,$

Legal costs of defending new patent in court $q,$

Materials consumed in manufacture of prototypes. $q,$

Consulting fees paid for general research $q,$

Indirect costs related to research and development. $q,$

$$320,000$

$250,000$

$290,000$

$40,000$

$36,000$

$13,100$

$45,200$

$9,700$

Instructions

Assuming Carmanah follows IFRS.

a$)$ Calculate the amount that Carmanah would be allowed to capitalize as an intangible asset for $2023.$

b$)$ Calculate the amount to be reported as research and development expense by Carmanah on its income staternent for $2023$ Assume the equipment is purchased at the beginning of the year.