New Co. received a patent on a new type of machine. The legal costs and the patent application

costs totaled $180,000. R&D costs incurred to create the machine were $120,000. In the year in

which the company received the patent, S25,000 was spent in the successful defense of a patent

infringement suit.

Required:

What amount of patent costs, if any, should be capitalized as an intangible asset?