Rooney Company incurred $280,000 of research costs in its laboratory to develop a patent granted on January 1, 2011.On July 31, 2011, Rooney paid $42,000 for legal fees in a successful defense of the patent.The total amount debited to Patents through July 31, 2011, should be:

Question

Quizplus · Accepted Answer

Research costs are not capitalized as part of the patent cost. Only the legal fees for the successful defense of the patent are capitalized, which is $42,000.

Rooney Company Incurred $280,000 of Research Costs in Its Laboratory