Question: Green Earth Corp has capitalized software costs of 980 000 on
Green Earth Corp. has capitalized software costs of $980,000 on a product to be sold externally. During its first year, sales of this product totalled $380,000. Green Earth expects to earn $1,560,000 in additional future revenue from this product, which is estimated to have an economic life of four years. Calculate the amount of software amortization, assuming that amortization is based on the pattern in which Green Earth receives benefits from the software program.
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