Research and Development Costs
Response to the following problem:
The KLK Clothing Company manufactures professional clothing for women. In order to keep costs low while still producing quality clothes, KLK conducts many research and development projects. On a current project, KLK researchers used $35,000 of cotton and $27,000 of wool from its inventory. KLK paid its researchers $30,000 in wages and purchased a special weaving machine for $60,000 cash. The machine was not suitable for use in production activities and was not expected to be used in other research projects. In addition, depreciation of the project's research lab amounted to $20,000.
Required
Prepare the journal entry to record KLK's research and development costs.