Transactions during 2018 of the newly organized HAM CORPORATION included the following:

Jan. 12 Paid legal fees of P 300,000 and stock certificate costs of P 166,000 to complete organization of the corporation.

Jan. 25 Hired a clown to stand in front of the corporate office for 2 weeks and hound out pamphlets and candy to create goodwill for the new enterprise. Clown cost, P 20,000; pamphlets and candy, P 10,000.

Apr. 1 Patented a newly developed process with costs as follows:

Legal fees to obtain patent

858,000

Patent application and licensing fees

127,000

Total

985,000

It is estimated that in 6 years other companies will have developed improved processes, making the HAM CORPORATION process obsolete.

May 11 Acquired both a license to use a special type of container and a distinctive trademark to be printed on the container in exchange for 12,000 shares of HAM's no-par common stock selling for P50 per share. The license is worth twice as much as the trademark, both of which may be used for 6 years.

July 11 Constructed a shed for P2,620,000 to house prototypes of experimental models to be developed in future research projects.

Dec. 31 Incurred salaries for an engineer and chemist involved in product development totaling P3,500,000 in 2018.

Based on the above and the result of your audit, determine the cost of licenses.

Select one:

a. P-0-

b. P400,000

c. P200,000

d. P300,000