Question

During 2021, Blossom Co. incurred the following costs: Testing in search for process alternatives $390000 Costs of marketing research for new product 260000 Modification of the formulation of a process 570000 Research and development services performed by Crane Corp. for Blossom 485000 In Blossom's 2021 income statement, research and development expense should be

Answer 1

See below

Step-by-step explanation:

Given the above information, our concern when calculating amount of research and development costs charged to Blossom corp. for 2021 should be the period cost. This means costs that are incurred in the period under review. I.e 2021.

= Testing in search for process alternative + Cost of marketing research + Modification of formulation of a process + Consulting fees

= $390,000 + $260,000 + $570,000 + $485,000

= $1,705,000

Therefore, Blossom's 2021 income statement , research and development expense should be $1,705,000.