Lake Company, organized in 2020, has the following transactions related to intangible assets in that year. Lake Company uses thecalendar year for financial reporting.1/1/2020Purchased patent (9-year life)$540,0004/1/2020Purchased trademarks (indefinite life)240,0007/1/2020Purchased copyright on artwork; expiration date 7/1/2035345,00012/31/2020Research and development costs217,000Enter your answers below in whole dollars without a $ sign (e.g., xxx).a. How much expense will Lake Company recognize in 2020 due to the purchased patent?b. How much expense will Lake Company recognize in 2020 due to the purchased trademarks?c. How much expense will Lake Company recognize in 2020 due to the purchased copyright?d. How much expense will Lake Company recognize in 2020 due to its Research and development?e. Based on the above, what is the net book value of total intangible assets that Lake Company's balance sheet will show on Dec.31, 2020?

As per our protocol we provide solution to the first three sub-parts only but as you have asked…

a. How much expense will Lake Company recognize in 2020 due to the purchased patent? b. How much expense will Lake Company recognize in 2020 due to the purchased trademarks? c. How much expense will Lake Company recognize in 2020 due to the purchased copyright?

a. How much expense will Lake Company recognize in 2020 due to the purchased patent? b. How much expense will Lake Company recognize in 2020 due to the purchased trademarks? c. How much expense will Lake Company recognize in 2020 due to the purchased copyright?

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter12: Intangibles

Section: Chapter Questions

Problem 8P

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Question

Lake Company, organized in 2020, has the following transactions related to intangible assets in that year. Lake Company uses the
calendar year for financial reporting.
1/1/2020
Purchased patent (9-year life)
$540,000
4/1/2020
Purchased trademarks (indefinite life)
240,000
7/1/2020
Purchased copyright on artwork; expiration date 7/1/2035
345,000
12/31/2020
Research and development costs
217,000
Enter your answers below in whole dollars without a $ sign (e.g., xxx).
a. How much expense will Lake Company recognize in 2020 due to the purchased patent?
b. How much expense will Lake Company recognize in 2020 due to the purchased trademarks?
c. How much expense will Lake Company recognize in 2020 due to the purchased copyright?
d. How much expense will Lake Company recognize in 2020 due to its Research and development?
e. Based on the above, what is the net book value of total intangible assets that Lake Company's balance sheet will show on Dec.
31, 2020?

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