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Cost associated with various intangibles of a company may either be expensed when incurred or capitalized and amortized. Such cost might be recorded in any

Cost associated with various intangibles of a company may either be expensed when incurred or capitalized and amortized. Such cost might be recorded in any of the following ways:

a) Charged to the patent account and amortized

b)charged to the franchise account and amortized

c)charged to the origination cost account and amortized

d) Charged to other appropriate asset accounts and amortized or depreciated

e) charged to expense when incurred

Help indicating how each of the following cost should be recorded by placing the appropriate letter A-E next to scenario

___________1) Initial feeds to acquire a franchise

___________2) Design, construction and testing of preproduction prototypes and models

___________3) Legal cost incurred in connection with a successful patent application

___________4) Laboratory research aimed at discovery of new knowledge

___________5) Cost of purchased equipment that will be used in a series of R&D projects over a ten-year period

___________6) Legal cost of the initial incorporation of a business

___________7) Cost of a long-term lease of mineral deposits

___________8) Annual service fee paid to the franchisor's headquarters for admin services rendered to the franchise

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