Question
Maribeth Company made the following expenditures relating to Product Zee: Legal costs to file a patent on Product Zee. Production of the finished product would
Maribeth Company made the following expenditures relating to Product Zee:
Legal costs to file a patent on Product Zee. Production of the finished
product would not have been undertaken without the patent 100,000
Special equipment to be used solely for development of Product Zee. The
equipment has no other use and has an estimated useful life of four years 600,000
Labor and material costs incurred in producing a prototype model 2,000,000
Cost of testing the prototype 800,000
What total amount of costs should be expensed when incurred?
A. 2,800,000
B. 2,950,000
C. 3,400,000
D. 3,500,000
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