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Unformatted text preview: (3) At the beginning of the current year, Cartwright Corporation paid $15,000 for materials to be used exclusively in a single R&D project. Of these, 20% are still on hand at year-end. How should Cartwright account for the materials purchased? Expense the materials used in the project. For the remaining inventory, carry them as inventory and allocate as consumed, or capitalize and depreciate as used. (4) Cartwright Corporation also purchased an experimental machine from an inventor for $12,000. The machine will be used for a single R&D project for two years after which it will have no residual value. How should Cartwright account for the cost of the machine? Expense (5) Refer to Illustrations 12-16 and 12-17 on p. 611 pertaining to Merck and Co., Inc. How much did Merck expense for R&D in 2006? 4782.9 What is Merck's compounded annual growth rate in R&D expenditures for the period -1996-2006? 11%...
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- Spring '08