Earth company incurred the following costs during the current year: Laboratory research aimed at discovery of new knowledge 750,000 Design of tools, jigs, molds and dies involving new technology 400,000 Quality control during commercial production including routine testing 350.000 Equipment acquired two years ago, having an estimated useful life of five years with no 1,500,000 residual value used in various R and D projects Research and development services performed by Star company for Earth Company 250.000 Research and development services performed by Earth Company for Moon Company 200,000