omework Exercise 10-26 Research and development [LO10-8 In 2018, Space Technology Company modified its model Z2 satellite to incorporate a new communication device. The company made the following expenditures Basie research to develop the technology Engineering design woek Development of a prototype device Aoquiaition of equipment Testing and modification of the prototype Legal and other fees tor patent application on the new communieation system Legal fees for suecessful defense of the new patent 2,550,00 90.000 10,000 1.000 30,000 51,000 31 09 4,213,000 The equipment will be used on this and other research projects. Depreciation on the equipment for 2018 is $21000 During your year-end review of the accounts related to intangibles, you discover that the company has capitalized all of the above as costs of the patent. Management contends that the device simply represents an improvement of the existing communication system of the satelite and, therefore, should be capitalized Prepare correcting entries that reflect the appropriate treatment of the expenditures. (If no entry is required for a transaction/event, select "No journal entry required in the first account field, Journal entry worksheet