Grand Trunk Corp.incurred $160,000 of basic research and $50,000 of development costs to develop a product for which a patent was granted on January 2, 2012.Legal fees and other costs associated with registration of the patent totalled $60,000.On March 31, 2017, Grand Trunk paid $90,000 for legal fees in a successful defence of the patent.The total amount capitalized for the patent through March 31, 2017 should be
A)$360,000.
B)$270,000.
C)$200,000.
D)$150,000.

Question

Quizplus · Accepted Answer

The total amount capitalized for the patent includes the costs associated with the registration of the patent ($60,000) and the legal fees for the successful defense of the patent ($90,000), totaling $150,000. Research and development costs are typically expensed, not capitalized.