Question

Pier Company incurred $150,000 of research and development costs in its laboratory to develop a new product. It spent $20,000 in legal fees for a patent granted on January 2, 2020. On July 31, 2020, Pier paid $15,000 for legal fees in a successful defense of the patent. What is the total amount that should be debited to Patents through July 31, 2020? Select one: a. $150,000 b. $185,000 c. $170,000 d. $35,000 e. $20,000

Answer 1

$35,000

Step-by-step explanation:

Data provided

Legal fee for Granted = $20,000

Legal fee for Defend = $15,000

The computation of total amount that should be debited to Patents is shown below:-

Total amount Debited to Patents = Legal fee for Granted + Legal fee for Defend

= $20,000 + $15,000

= $35,000

Therefore for computing the Total amount Debited to Patents we simply applied the above formula.