(Solution) - Cressman Company incurred research and development costs in 2007 -(2025 Original AI-Free Solution)

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Academic Level: Undergrad. (yrs 3-4)

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Cressman Company incurred research and development costs in 2007 as follows:
Materials used in research and development projects ............ $ 400,000
Equipment acquired that will have alternate future uses in future research and development projects for four years ....................... 2,000,000
Personnel costs of employees involved in research and development projects . 1,000,000
Consulting fees paid to outsiders for research and development projects .... 100,000
Indirect costs reasonably allocable to research and development projects ...... 200,000

Required
What is the amount of research and development costs charged to Cressman?s 2007 income?