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Sarasota Company is a U.S.-based company that designs and builds compressors for large HVAC units. Sarasota decides to build a new plant in China, its
Sarasota Company is a U.S.-based company that designs and builds compressors for large HVAC units. Sarasota decides to build a new plant in China, its first attempt at doing business internationally. During its start-up phase, Sarasota incurs $2015000 of start-up costs including $1007500 in legal fees, $705250 to introduce its product, and another $302250 in state fees to the Chinese government to organize the new business entity. Sarasota Company's CEO fully expects the company to become profitable during its 3rd year of operations. How should Sarasota Company account for these costs
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