costs of personnel 500,000 Outside consulting fees 150,000 Indirect costs appropriately allocated 250,000 The total research and development costs charge in Sponge's 2021 statement of profit or loss should be: 850,000 1,085,000 1,235,000

costs of personnel 500,000 Outside consulting fees 150,000 Indirect costs appropriately allocated 250,000 The total research and development costs charge in Sponge's 2021 statement of profit or loss should be: 850,000 1,085,000 1,235,000

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter11: Depreciation, Depletion, Impairment, And Disposal

Section: Chapter Questions

Problem 8MC: On July 1, 2018, Mundo Corporation purchased factory equipment for 50,000. Residual value was...

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Concept explainers

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.

Question

22.Sponge Co. incurred research and development costs in 2021 as follows:
Equipment acquired for use in various research
and development projects 975,000
Depreciation on the above equipment 135,000
Materials used 200,000
Compensation costs of personnel 500,000
Outside consulting fees 150,000
Indirect costs appropriately allocated 250,000

The total research and development costs charge in Sponge's 2021 statement of profit or loss should be:

850,000

1,085,000

1,235,000

1,825,000

Definition Definition Amount earned or lost on the sale of one or more items is referred to as the profit or loss on that item

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