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Research and development expense

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Riley Co. incurred the following costs during 2007:

Modification to the formulation of a chemical product = $160,000.
Trouble-shooting in connection with breakdowns during commercial = $150,000.
Costs of marketing research for new product = $200,000.
Seasonal or other periodic design changes to existing products = $185,000.
Laboratory research aimed at discovery of new technology = $215,000.

In its income statement for the year ended December 31, 2007, Riley should report research and development expense of how much?

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The solution explains how to determine the amount of research and development expense for the year ended.

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