Savanne Corp. incurred the following costs during 2014 and 2015:

Research and development costing $20,000 was conducted on a new product to sell in future years. A product was successfully developed, and a patent for it was granted during 2014. Savanne is unsure of the period benefited by the research, but believes the product will result in increased sales over the next five years.

Legal costs and application fees of $13,700 for the 20-year patent were incurred on January 1, 2014.

A patent infringement suit was successfully defended at a cost of $8,000. Assume that all costs were incurred on January 1, 2015.

Required:

Determine how the costs should be presented on Erin's financial statements as of December 31, 2014 and January 1, 2015. Also determine the amount of amortization of intangible assets that Savanne should record in 2014 and 2015.