R&D Costs and Journal Entries for 2020: Salaries, Supplies,

Chapter 10 Handout 2 Research & Development Costs The Askew Company made the following cash expenditures during 2020: R&D salaries$10,000,000 R&D supplies consumed3,000,000 Purchase of R&D equipment5,000,000 Patent filing & legal cost100,000 Payment to others for services performed in connection with R&D activities1,200,000 Total$19,300,000 The project resulted in a new product to be manufactured in 2021. The equipment purchased will be employed in other projects. Depreciation on the equipment for 2020 was $500,000. Prepare the journal entries to record R&D expense, the purchase of R&D equipment and associated depreciation, and the filing of the patent resulting from the R&D R&D Expense14,200,000 Cash14,200,000 Equipment5,000,000 Cash5,000,000 R&D Expense500,000 Accumulated depreciation - Equipment500,000 Patent100,000 Cash100,000