Axcel Software Began a New Development Project in 2015

question 43

Multiple Choice

Axcel Software began a new development project in 2015.The project reached technological feasibility on June 30,2016,and was available for release to customers at the beginning of 2017.Development costs incurred prior to June 30,2016,were $3,200,000 and costs incurred from June 30 to the product release date were $1,400,000.The 2017 revenues from the sale of the new software were $4,000,000,and the company anticipates additional revenues of $6,000,000.The economic life of the software is estimated at four years.2017 amortization of the software development costs would be:

• A)$0.
• B)$ 350,000.
• C)$1,840,000.
• D)$ 560,000.

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Definitions:

Pure Monopolist

A market structure where a single company exclusively controls the entire supply of a product or service without any competition.

MR = MC Output

The optimal output level for a firm where marginal revenue (MR) equals marginal cost (MC), commonly used to maximize profit.

Maximizing Profits

Maximizing profits is the process by which a firm adjusts its production and operational strategies to achieve the highest possible financial gain.

Reduce Output

A decision or strategy to decrease the quantity of goods or services produced by a company or economy.