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Northern Company incurred the following costs during the year related to the creation of a new product:
Salaries
$200,000
Depreciation on R&D equipment
$50,000
Quality control during commercial production
$10,000
Patent filing and legal costs
$8,000
Payment for services in connection with R&D activities
$20,000
Testing of preproduction prototypes and models
$5,000
What amount should Northern report as research and development expense in its income statement?

Answer :

Northern should report testing of preproduction prototypes and models as research and development expense in its income statement.

Research and development general laboratory building which may be place to various uses within the future. The analysis associated development general laboratory building ought to be recorded as an plus since it'll profit the corporate on the far side analysis and development and can would like depreciation over its life.

An income statement or profit and loss account is one amongst the monetary statements of an organization and shows the company's revenues and expenses throughout a selected amount. It indicates however the revenues ar reworked into Infobahn financial gain or income.

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