Check my work [The following information applies to the questions displayed below.) Satellite Systems modified its model Z2 satellite to incorporate a new communication device. The company made the following expenditures: Basic research to develop the technology Engineering design work Development of a prototype device Testing and modification of the prototype Legal fees for patent application Legal fees for successful defense of the new patent Total $4,900,000 1,360,000 690,000 490,000 89,000 49,000 $ $7,578,000 During your year-end review of the accounts related to intangibles, you discover that the company has capitalized all the above as costs of the patent Management contends that the device represents an improvement of the existing communication system of the satellite and, therefore, should be capitalized. 797 e 918 PM AB40 27/2001 During your year-end review of the accounts related to intangibles, you discover that the company has capitalized all the above as costs of the patent Management contends that the device represents an improvement of the existing communication system of the satellite and therefore, should be capitalized. Required: 1. Determine the amount Satellite Systems should capitalize to the Patent account in the balance sheet. Patent costs capitalized 19 PM 7944 O 3 Check my work me Tuhuwing UITRUUII appre's tu uve questOrIS Uispiacu venuw. Satellite Systems modified its model Z2 satellite to incorporate a new communication device. The company made the following expenditures: Basic research to develop the technology Engineering design work Development of a prototype device Testing and modification of the prototype Legal fees for patent application Legal fees for successful defense of the new patent Total $4,900,000 1,360, eee 690,000 490,000 89,000 49,000 $7,578,000 During your year-end review of the accounts related to intangibles, you discover that the company has capitalized all the above as costs of the patent. Management contends that the device represents an improvement of the existing communication system of the satellite and therefore, should be capitalized. NE Check my work Total $7,578,000 During your year-end review of the accounts related to intangibles, you discover that the company has capitalized all the above as costs of the patent Management contends that the device represents an improvement of the existing communication system of the satellite and, therefore, should be capitalized. 2. Determine the amount Satellite Systems should report as research and development expense in the income statement Research and development expense 2:19 PM 797 do 5 G . O 11
