Consider the following information from a company's records for 2020: Materials used in research and development projects $4,500 Equipment acquired that will have alternative future uses in future R&D projects for five years 1,500 Personnel costs of employees involved in R&D projects 5,500 Consulting fees paid to outsiders for R&D projects 2,800 Indirect costs reasonably allocable to R&D projects 250 Legal fees associated with registration of a patent resulting from a 2020 R&D project 2,500 Required: Compute the amount of R&D costs that should be classified as expenses in determining 2020 net income.

Consider the following information from a company's records for 2020: Materials used in research and development projects $4,500 Equipment acquired that will have alternative future uses in future R&D projects for five years 1,500 Personnel costs of employees involved in R&D projects 5,500 Consulting fees paid to outsiders for R&D projects 2,800 Indirect costs reasonably allocable to R&D projects 250 Legal fees associated with registration of a patent resulting from a 2020 R&D project 2,500 Required: Compute the amount of R&D costs that should be classified as expenses in determining 2020 net income.

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter8: Depreciation And Sale Of Business Property

Section: Chapter Questions

Problem 7P: Calculate the following: The first year of depreciation on a residential rental building costing...

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Consider the following information from a company's records for 2020: Materials used in research and development projects $4,500 Equipment acquired that will have alternative future uses in future R&D projects for five years 1,500 Personnel costs of employees involved in R&D projects 5,500 Consulting fees paid to outsiders for R&D projects 2,800 Indirect costs reasonably allocable to R&D projects 250 Legal fees associated with registration of a patent resulting from a 2020 R&D project 2,500 Required:Compute the amount of R&D costs that should be classified as expenses in determining 2020 net income. $ _______
Consider the following information from a company's records for 2020: Materials used in research and development projects Equipment acquired that will have alternative future uses in future R&D projects for five years Personnel costs of employees involved in R&D projects Consulting fees paid to outsiders for R&D projects Indirect costs reasonably allocable to R&D projects Legal fees associated with registration of a patent resulting from a 2020 R&D project Required: a. b. $4,500 1,500 5,500 2,800 260 2,400 Compute the amount of R&D costs that should be classified as expenses in determining 2020 net income. For any listed item not included in your answer to requirement 1. provide the rationale for not expensing it.
Materials used in research and development projects $4,500 Equipment acquired that will have alternative future uses in future R&D projects for five years 1,500 Personnel costs of employees involved in R&D projects 5,500 Consulting fees paid to outsiders for R&D projects 2,800 Indirect costs reasonably allocable to R&D projects 250 Legal fees associated with registration of a patent resulting from a 2020 R&D project 2,500 Required: Compute the amount of R&D costs that should be classified as expenses in determining 2020 net income.$fill in the blank 1
Treasure Land Corporation incurred the following costs in 2020. Cost of laboratory research aimed at discovery of new knowledge $120,000 Cost of testing in search for product alternatives 100,000 Cost of engineering activity required to advance the design of a product to the manufacturing stage 210,000 Prototype testing subsequent to meeting economic viability 75,000 $505,000 Prepare the necessary 2020 journal entry(ies) for Treasure Land.
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Treasure Land Corporation incurred the following costs in 2020. Cost of laboratory research aimed at discovery of new knowledge $120,000 Cost of testing in search for product alternatives 100,000 Cost of engineering activity required to advance the design of a product to the manufacturing stage 210,000 $430,000 Prepare the necessary 2020 journal entry or entries for Treasure Land.
Consider the following information from a company's records for 2020: Feb. 11 Purchased materials exclusively for use in R&D projects. Of these materials, 30% are left at the end of 2020 and will be used in the same project in 2021 (they have no alternative use). $85,000 Aug. 28 Construction costs for a new research facility that has been placed in use on this date and is expected to be used to house multiple R&D activities for 20 years. The facility has no expected salvage value. 600,000 Aug. 29 Purchased an experimental machine from an inventor. The machine is expected to be used for a particular R&D activity for two years, after which it will have no residual value. 16,000 Nov. 26 Salaries paid to employees involved in R&D. 35,000 Required: Compute the amount of R&D expense for 2020. The company normally uses straight-line depreciation for plant assets.$
MD. Incurred the following costs during 2019 in connection with its research and development activities (dalam Rp. 000.000) : Cost Amount Cost of equipment acquired that will have alternative uses in future R&D Projects over the next 5 years (uses straight line method) Material consumed in R&D projects Consulting fees paid to outsiders for R&D projects Personal cost of persons involved in R&D projects Indirect costs reasonably allocable to R&D projects Materials purchased for future R&D projects 330.000 59.000 100.000 128.000 50.000 34.000 Compute the amount to be reported as research and development expense by Martinez on its income statement for 2019. Assume equipment is purchased at the beginning of the year and economic viability has not been achieved.
The following costs were incurred by ABCDEFGH, Inc.. during 2020: July 1 Organization fees P120,000 July 2 Land site and old building 1,890,000 July 3 Option payments 250,000 July 20 Broker’s fees on property acquired 110,400 July 30Cost of remodeling the building 60,000 August 30 Salaries of executives 360,000 December 21 Real property taxes 240,000 Additional information: The building acquired had a fair value of P450,000 while the land was currently appraised at P1,800,000 P50,000 of the option money paid were for properties not acquired. The executives had no participation on the remodeling of the building The property taxes were for the 2020 calendar year. How much is the cost of land? a. 1,856,320 b. 2,288,000 c. 1,992,320 d. 1,512,000
The following costs are incurred by Everlasting Corporation in 2022: a. Cost of activities aiming new knowledge P150,000 b. Cost of developing and producing prototype model 30,000 c. Cost of seminars to introduce the newly develop product 120,000 d. Advertisement cost to introduce the newly develop product 60,000 e. Cost incurred for search of alternatives 35,000 f. Cost of final selection of possible alternatives 50,000 g. Cost of machine acquired to be used only in an R&D project 300,000 h. Cost of engineering follow through in an early phase of commercial production 50,000 i. Adaptation of an existing capability to particular customers need 36,000 j. Salaries of employees involved in R&D 480,000 k. Radical modification to the formulation of a chemical product 40,000 l. Laboratory…
Lucky Mae Company incurred research and development costs in 2020 as follows: Equipment acquired for various researches and development projects P1,400,000; Depreciation on the above equipment P140,000; Materials used P136,000: Compensation cost for personnel P450,000; Outside consulting fees P87,000; Indirect costs appropriately allocated P120,000. What is the total research and development cost charged in Lucky Mae's Income Statement? *
Revenue and costs for ABC Company for the year 2019 are presented below: • Revenue. . • G&G cost. $300,000 300,000 • Acquisition costs.. • Exploratory Dry holes.. • Successful exploratory holes. . 1,500,000 • Development wells, dry . • Development wells, successful . 400,000 • Production facilities.. • Production cost.. 1,000,000 2,000,000 500,000 350,000 50,000 Successful efforts Full cost • Amortization for 2019 $100,000 $200,000 • Accumulated DD&A 250,000 350,000 Required: 1- Prepare the income statement for ABC Oil Company for the year ended 2019 under the two accounting methods. 2- Show the difference explanation between the two accounting methods Net income/Loss.