PROBLEMS Problem 48-1 (IFRS) Alexandria Company started a research and development G project on a new product on January 1, 2017. op Total cost incurred before reaching technological feasibility T amounted to P4, 000,000 while development cost after ma reaching technological feasibility amounted to P5,000,000 CO before year-end. Th Prior to commercial production, the entity paid legal and yea registration fees amounting to P1,000,000 in filing for a patent on the new product on July 1, 2017. Sal Cos Early in January 2018, an additional amount of P2,000,000 Add was incurred to develop the project to full manufacturing Cost stage. The patent was approved in early January 2018 and valid Cost for 20 years. Wh However, the entity expected technological advancements dev will render the new product virtually obsolete by December a. 31, 2022. b. The entity decided to account separately any capitalized C . d. 1. development cost. 1. What amount should be capitalized as cost of patent? Prob a. 1,000,000 Hypo b. 6,000,000 devel C. 7,000,000 d. 5,000,000 Equip and 2. What amount should be capitalized as development cost? Depreci Materia a. 5,000,000 Compen b. 7,000,000 Outside C . 9,000,000 Indirect d. 6,000,000 3. What total amount should be reported as amortization What an expense of intangible assets for 2018? a 85 a. 1,600,000 b. 1,08 b. 1,000,000 C. 1,23 C. 200,000 d. 1.82 d. 400,000 1534