Reference no: EM131596552
Question - Alfalfa's, a socially conscious maker of premium whole foods, had the following costs associated with two new products:
Recipe development costs - $ 45,000
Laboratory equipment used exclusively for research - 15,000
Laboratory equipment having future uses in other R&D projects - 45,000
Legal costs of patent applications - 8,880
Internal design costs of trademark - 5,000
Trademark registrations - 4,200
Manufacturing equipment - 120,000
Mfg. equipment set-up and trial run costs - 15,000
Depreciation of building (30% of space is occupied by R&D department) - 400,000
Pollution control equipment - 50,000
Advertising - 27,900
Litigation costs associated with successful defense of patent - 5,700
Required - Assume that all equipment has a ten-year life and that straight line depreciation is used. Determine the proper accounting treatment for each of the above costs and prepare a summary journal entry to properly record the costs.