WGS pays $20 million for an option to purchase land in Brazil, where the company intends to build a distribution center to serve Latin America. The option gives WGS the right to purchase the land for $500 million at any point during the next five years. 5. WGS spends $10 million on Research and Development to develop a new calorie-free salad dressing. Half of the total was for research, and the other half on development. The R&D is successful, and WGS acquires a patent on this new product. The cost of filing the paperwork and other procedures to obtain the patent is $0.5 million. 6. WGS buys a piece of equipment with a list price of $6 million. It receives $0.6 million as an early-bird discount. It pays $0.2 million as freight to get the equipment to its warehouse. 7. WGS pays rent in advance for next year for the amount of $30 million