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Question - Bernadeth Company, a large entity, developed a new machine that reduces the time required to insert the fortune cookies. Because the process is considered very valuable to the fortune cookie industry, Bernadeth Company patented the machine. The following expenses were incurred in developing and patenting the machine: Research and development laboratory expenses 500,000 Metal used in the construction of the machine 160,000 Blueprint used to design the machine 60,000 Legal expenses to obtain patent 240,000 Wages paid for the employees' work on the research and development, and building of the machine (60% of the time was spent in actually building the machine) 600,000 Expense of drawing required by the patent office to be submitted with the patent application 30,000 Fee paid to government patent office to process application 50,000.
How much of the expenditures should be capitalized as cost of patent?
If the company is an SME, what much is the expenditures that should be capitalized as cost of patent?
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