Compute: (1) Amount to be capitalized as software development cost subject to amortization, (2) Cost of ending inventory, and

(3) Total amount related to the development of computer software that should be expensed when incurred.

Pagsanjan Softbytes Corporation is engaged in developing computer software for the small business at home computer market. Most of the computer programmers are involved in developmental work designed to produce software that will perform fairly specific tasks in a user friendly manner. Extensive testing of the working manner is performed before it is released to production for preparation of masters and further testing. As a result of careful preparation, Pagsanjan has produced several products that have been very successful in the market place. The following costs were incurred during 2010: Salaries and wages of programmers doing research P940.000 Expenses related to projects prior to establishment of technological feasibility 313,600 Expenses related to projects after technological feasibility has been established but before software is available for production 198.000 Amortization of capitalized software development cost from current and prior years 107.000 Costs of produce and prepare software for sale 225.200 Additional data for 2010 Sales of products for the year P2,060,000 Beginning inventory 568,000 Portion of goods available for sale sold during the year 60%