Gomez incurred $350,000 of research and development costs to develop a product f

Question

Gomez incurred $350,000 of research and development costs to develop a product for which a patent was granted on January 2, 2008.  Legal fees and other costs associated with the registration of the patent totaled $100,000.  On January 1, 2012, Gomez paid legal fees of $150,000 in a successful defense of the patent. Show calculations.

The total amount capitalized for the patent account (ignoring amortization) through January 1, 2013 should be

  a. $100,000

  b. $250,000

  c. $500,000

  d. $600,000

Explanation / Answer

b. $250,000

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