On August $1,$ Year $1,$ SuperCool Software $($SCS$)$ began developing a software program to allow individuals to customize their investment portfolios. Technological feasibility was established on January $31$st of year $2,$ and the program was available for release on March $31,$ year $2.$ Development costs were incurred as follows:

August $1$ through December $31,$ Year $1$$ $4,000,000$January $1$ through January $31,$ Year $2600,000$February $1$ through March $31,$ Year $2900,000$

SCS expects a useful life of five years for the software and total revenues of $$10,000,000$ during that time. During Year $2,$ SCS recognized $$2,000,000$ in revenue, included in the $$10,000,000$ total revenue estimate.

Calculate the required amortization for Year $2($Hint: calculate using both methods, choose the greater number$)$

Required information

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The allocation process for intangible assets is called amortization. For an intangible asset with a finite useful life, the capitalized cost less any estimated residual value must be allocated to periods in which the asset is expected to contribute to the company's revenue$-$generating activities. An intangible asset that is determined to have an indefinite useful life is not subject to periodic amortization. Goodwill is perhaps the most typical intangible asset with an indefinite useful life.

The Astro Corporation develops computer software graphics programs for sale. A new development project begun in Year $1$ reached technological feasibility at the end of June Year $2,$ and the product was available for release to customers early in Year $3.$ Development costs incurred in Year $2$ prior to June $30$ were $\backslash (\backslash$$ $1,200,000\backslash )$ and costs incurred from June $30$ to the product availability date were $\backslash (\backslash$$ $800,000\backslash ).$ Year $3$ revenues from the sale of the new product were $\backslash (\backslash$$ $3,000,000\backslash )$ and the comnanu antiminatac an additional $\backslash (\backslash$$ $7,000,000\backslash )$ in revenues in future years. The economic life of $\backslash ($ t$+\backslash )$ nated at four years.

The percentage$-$of$-$revenue method is used because it produces the greater amortization, $\backslash (\backslash$$ $240,000\backslash ).$

Knowledge Check $01$

On August $1,$ Year $1,$ SuperCool Software $($SCS$)$ began developing a software program to allow individuals to customize their investment portfolios. Technological feasibility was established on January $\backslash (31^\{\backslash$text $\{$st $\}\}\backslash )$ of year $2,$ and the program was available for release on March $31,$ year $2.$ Development costs were incurred as follows:

$```$

August $1$ through December $31,$ Year $1$

$ $4,000,000$

$\_600,000$

$```$

SCS expects a useful life of five years for the software and total revenues of $\backslash$$$10,000,000$ during that time. During Year $2,$ SCS recognized $\backslash (\backslash$$ $2,000,000\backslash )$ in revenue, included in the $\backslash (\backslash$$ $10,000,000\backslash )$ total revenue estimate.

Calculate the required amortization for Year $2($Hint: calculate using both methods, choose the greater number$)$

Answer is complete but not entirely correct.