Lopez Corp.incurred $420,000 of research and development costs to develop a product for which a patent was granted on January 2, 2002.Legal fees and other costs associated with registration of the patent totaled $80,000.On March 31, 2007, Lopez paid $120,000 for legal fees in a successful defense of the patent.The total amount capitalized for the patent through March 31, 2007 should be

Question

Quizplus · Accepted Answer

Research and development costs are expensed as incurred and not capitalized. The capitalized costs for the patent include the legal fees and registration costs of $80,000 and the legal fees for the successful defense of the patent of $120,000, totaling $200,000.