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zif software is a firm with significant research and development expenses in the mos 546268

Zif Software is a firm with significant research and development expenses. In the most recent year, the firm had $100 million in research and development expenses. R&D expenses are amortizable over 5 years and the R& D expenses over the last 5 years are as follows:

Year

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R&D expenses

-5

$ 50 million

-4

$ 60 million

-3

$ 70 million

-2

$ 80 million

-1

$ 90 million

Current year

$ 100 million

Assuming a linear amortization schedule (over 5 years), estimate

a. the value of the research asset.

b. the amount of R&D amortization this year.

c. the adjustment to operating income.

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