During 2017, Carla Vista Enterprises Ltd., a private entity, incurred $4.6 million in costs to develop a new software product called Dover. Of this amount, $1.6 million was spent before establishing that the product was technologically and financially feasible. Dover was completed by December 31, 2017, and will be marketed to third parties. Carla Vista expects a useful life of 7 years for this product, with total revenues of $15 million. During 2018, Carla Vista realized revenues of $2.7 million from sales of Dover.

At what amount should the software costs be reported in the December 31, 2018 balance sheet? (Round answer to 0 decimal places, e.g. 5,275.)

The Software costs be reported in the December 31, 2018 balance sheet