Golden Company developed a new machine for manufacturing baseballs.Because the machine is considered very valuable, the entity had it patented.The following expenditures were incurred in developing and patenting the machine.

• Purchase of special equipment to be used solely for development of the new machine, P1,700,000
• Research salaries and fringe benefits for engineers and scientists, P300,000
• Cost of testing prototype, P200,000
• Legal cost for filing of patent, P6,000
• Fees paid to government patent office, P40,000
• Drawings required by patent office to be filed with patent application, P50,000

How much is the cost of patent and research and development expense?

a. Patent P96,000; Research and Development expense P500,000

b. Patent P96,000; Research and Development expense P2,200,000

c. Patent P296,000; Research and Development expense P2,000,000

d. Patent P396,000; Research and Development expense P1,900,000