Blue Corporation, a manufacturing company, decided to develop a new line of merchandise. The project began in 2018. Blue had the following expenses in connection with the project:

The new product will lx? introduced for sale beginning in July 2020. Determine
the amount of the deduction for research and experimental expenditures for 2018, 2019, and 2020 if:
a. Blue Corporation elects to expense the research and experimental expenditures.
b. Blue Corporation elects to amortize the research and experimental expenditures over 60 months.

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2018 2019 $500,000 $600,000 Salaries Materials 90,000 70,000 Insurance 8,000 11,000 Utilities 6,000 8,000 Cost of inspection of materials for quality control 7,000 6,000 Promotion expenses 11,000 18,000 Advertising -0- 20,000 Equipment depreciation 15,000 14,000 Cost of market survey 8,000 -0-