Last Year, Green Corporation Incurred the Following Expenditures in the Development

question 37

Multiple Choice

Last year, Green Corporation incurred the following expenditures in the development of a new plant process: $$\begin{array} { l r } \text { Salaries } & \$ 250,000 \\\text { Materials } & 90,000 \\\text { Utilities } & 20,000 \\\text { Quality control testing costs } & 40,000 \\\text { Management study costs } & 5,000 \\\text { Depreciation of equipment } & 18,000\end{array}$$ ? During the current year, benefits from the project began being realized in May.If Green Corporation elects a 60 month deferral and amortization period, determine the amount of the deduction for the current year.

• A)$48,000
• B)$50,400
• C)$54,667
• D)$57,067
• E)None of the above

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Definitions:

Direct Labor Hours

The total hours worked by employees who are directly involved in the production process of goods or services.

PVC Fencing

A fencing material made from polyvinyl chloride, known for its durability, weather resistance, and low maintenance requirements.

Plantwide Overhead Rate

A unified rate employed across the entire manufacturing facility to allocate overhead expenses to products.

Machine Hours

A measure of the amount of time that machinery is operating and being used for production within a given period.