QUESTION 26

1. McMahon made the following expenditures during 2020 for the development of a new process that was patented by year end:

   Materials and supplies	$	380
   R&D salaries		1,200
   Patent filing fees		30
   Payments to external consultants		500
   Purchase of R&D equipment		1,400

   The equipment has no further use after this project. $100 of materials and supplies and $320 of salaries are for prototype construction. McMahon will report in 2020 research and development of:

   	A.	$3,060.
   	B.	$2,080.
   	C.	$3,510.
   	D.	$3,480.