During 2018, the Ellison Software Company incurred development costs of $8,000,000 related to a new software project. Of this amount, $1,600,000 was incurred after technological feasibility was achieved. The project was completed in the middle of the year and the product was available for release to customers on July 1. Year 2018 revenues from the sale of the new software were $2,000,000 and the company anticipated future additional revenues of $18,000,000. The economic life of the software is estimated at four years. Year 2018 amortization of the software development costs should be:

1. $800,000
2. $200,000
3. $400,000
4. $160,000