Exercise 8-8: For each of the following intangible assets, indicate the amount of amortization expense that should be recorded for the year 2016 and the amount of accumulated amortization on the balance sheet as of December 31, 2016. Trademark Patent Copyright Cost $40,000 $50,000 $80,000 Date of purchase 1/1/09 1/1/11 1/1/14 Useful life indefinite 10 yrs. 20 yrs. Legal life undefined 20 yrs. 50 yrs. Method SL* SL SL

Exercise 8-8: For each of the following intangible assets, indicate the amount of amortization expense that should be recorded for the year 2016 and the amount of accumulated amortization on the balance sheet as of December 31, 2016. Trademark Patent Copyright Cost $40,000 $50,000 $80,000 Date of purchase 1/1/09 1/1/11 1/1/14 Useful life indefinite 10 yrs. 20 yrs. Legal life undefined 20 yrs. 50 yrs. Method SL* SL SL

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter7: Operating Assets

Section: Chapter Questions

Problem 26CE

See similar textbooks

Similar questions

For each of the following intangible assets, indicate the amount of amortization expense that should be recorded for the year 2017 and the amount of accumulated amortization on the balance sheet as of December 31, 2017. Trademark Patent Copyright Cost $35,800 $47,400 $69,200 Date of purchase 1/1/10 1/1/12 1/1/15 Useful life indefinite 10 yrs. 20 yrs. Legal life undefined 20 yrs. 50 yrs. Method SL* SL SL *Represents the straight-line method. If an amount is zero, enter "0". Amount Trademark Patent Copyright 2017 amortization expense $fill in the blank 1 0 $fill in the blank 2 5,100 $fill in the blank 3 3,780 Accumulated amortization, Dec. 31, 2017 $fill in the blank 4 0 $fill in the blank 5 30,600 $fill in the blank 6 11,340
During 2022, Pfeiffer Co. purchased intangible assets and debited them all to "Intangible assets". 1-Jan Research and development costs $52,000 1-Jun Goodwill Indefinite Life $64,000 1-Oct Patent 7-Year Life $252,000 (a). Prepare a journal entry to reclassify them to an intangible asset account and/or expense account. (b). Prepare a journal entry to record amortization expense as of December 31, 2022.
Determining Carrying Value and Amortization of Intangible Assets Review the following information pertaining to Denzel Company. A patent was purchased on January 2, 2018, for $149,500 when the remaining legal life was 16 years. On January 2, 2020, Denzel determined that the remaining useful life of the patent was only eight years from the date of its acquisition. On January 1, 2020, Denzel Company purchased a second patent for $184,000 cash. At January 1, 2020, 6 years of the patent's legal life of 20 years had already expired. On June 30, 2020, Denzel Company paid a firm $18,400 for a new trademark. Denzel considers the life of the trademark to be indefinite. On November 1, 2020, Denzel Company acquired all noncash assets and assumed all liabilities of Lee Company at a cash purchase price of $276,000. Denzel determined that the fair value of the identfiable net assets acquired in the transaction is $269,100. Note: When answering the following questions, do not round until your…
Marshall Company orgainzed in 2016 has set up a single account for all intangible assets. The following summary discloses the debit entries that have been recorded durning 2017. 1/2/17 Purchased patent (8 year life) $350,000 4/1/17 Purchased goodwill(indefinite life) $360,000 7/1/17 Purchased franchise with 10-year life; exp. date 7/1/17 $450,000 8/1/17 Payment of copyright(5-year life) $156,000 9/1/17 Research and development cost $215,000 Instructions: Prepare the necessary entries to clear the Intangible Assest account and to set up separate accounts for distinct types of intangibnles. Make the entries as of December 31, 2017, recording any necessary amortization and rreflecting all balances accurately as of that date.(use straight-line amortization)
QUESTION 1 Polycarp Ltd adopts revaluation model for subsequent measurement of its intangible assetsin accordance with IAS 38: Intangible assets. The policy of Polycarp is to revalue itsintangible asset at the end of each year. An intangible asset with an estimated useful life of9 years was acquired on 1 January 2018 for GH¢45,000. It was revalued to GH¢54,400 on31 December 2018 and the revaluation surplus was correctly recognized on that date. Asat 31 December 2019, the asset was revalued at GH¢32,000. Required: Discuss the accounting treatment required in 2018 and 2019 financial statements. QUESTION 2 E. Adentwi Enterprises Ltd bought a machine for GH₵ 150,000 on 1st January 2019. It depreciates the machine on cost over four years assuming a nil residual value. The company received a grant of GH₵30,000 from the municipal assembly to support the acquisition of the machines. Required: Account for this grant under the netting off method.
The intangible assets section of Pina Corporation’s balance sheet at December 31, 2022, is presented here. Patents ($73,300 cost less $6,900 amortization) $66,400 Copyrights ($57,000 cost less $46,700 amortization) 10,300 Total $76,700 The patent was acquired in January 2022 and has a useful life of 10 years. The copyright was acquired in January 2016 and also has a useful life of 10 years. The following cash transactions may have affected intangible assets during 2023. Jan. 2 Paid $54,000 legal costs to successfully defend the patent against infringement by another company. Jan.– June Developed a new product, incurring $241,500 in research and development costs. A patent was granted for the product on July 1, and its useful life is equal to its legal life. Legal and other costs for the patent were $20,000. Sept. 1 Paid $68,000 to a quarterback to appear in commercials advertising the company’s products. The commercials will air in September and…
Information concerning Taylor Corporation’s intangible assets follows: 1. Taylor incurred $70,000 of experimental and development costs in its laboratory to develop a patent which was granted on January 2, 2025. Legal fees associated with the registration of the patent totaled $20,000. Taylor estimates that the useful life of the patent will be 10 years; the legal life of the patent is 20 years. The company uses the straight-line method of amortization for this asset. 2. On January 1, 2025, Taylor signed an agreement to operate as a franchisee of Dairy King, Inc. for an initial franchise fee of $150,000. The agreement provides that the fee is not refundable and no future services are required of the franchisor. Taylor estimates the useful life of the franchise to be 15 years and uses the straight-line method of amortization. 3. A trade name was purchased from Stine Company for $80,000 on May 1, 2023. Expenditures for successful litigation in defense of the trade name totaling…
Exercise 8-6: Assume that Gonzalez Company purchased an asset on January 1, 2014, for $60,000. The asset had an estimated life of six years and an estimated residual value of $6,000. The company used the straight-line method to depreciate the asset. On July 1, 2016, the asset was sold for $40,000. Make the journal entry to record depreciation for 2016. Record all transactions necessary for the sale of the asset. How should the gain or loss on the sale of the asset be presented on the income statement?
QUESTION 8 Co. A purchased a patent on 31 December 20X1 for $450,000. Co. A expects to use the patent for 5 years, after which it will be valueless. According to IAS 38 Intangible assets, compute the annual amortisation charge. What is the journal entry required to record the amortisation in the accounts for the year ended 31 December 20X2?
(Recording and Amortization of Intangibles) Parrish Company, organized in 2019, has set up a single account for all intangible assets. The following summary discloses the debit entries that have been recorded during 2020: 1/2/20 Purchased patent (8-year life) $ 625,000 4/1/20 Purchased goodwill (indefinite life) 540,000 7/1/20 Purchased franchise with 10-year life; expiration date 7/1/30 675,000 8/1/20 Payment for copyright (5-year life) 246,000 9/1/20 Research and development costs 342,500 $2,428,500 Instructions Prepare the necessary entries to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles. Make the entries as of December 31, 2020, recording any necessary amortization and reflecting all balances accurately as of that date. (Use straight-line amortization.)
Exercise 9-11 These are selected 2017 transactions for Novak Corporation: Jan. 1 Purchased a copyright for $93,600. The copyright has a useful life of 6 years and a remaining legal life of 35 years. Mar. 1 Purchased a patent with an estimated useful life of 5 years and a legal life of 25 years for $85,200. Sept. 1 Purchased a small company and recorded goodwill of $151,550. Its useful life is indefinite. Prepare all adjusting entries at December 31 to record amortization required by the events
Presented below is information related to copyrights owned by Wamser Corporation at December 31, 2014. Cost $2,700,000 Carrying amount 2,350,000 Recoverable amount 1,500,000 Assume Wamser will continue to use this asset in the future. As of December 31, 2014, the copyrights have a remaining useful life of 5 years. Instructions (a Prepare the journal entry to record amortization expense for 2015. (b) The recoverable amount of the copyright at December 31, 2015 is $1,600,000. Prepare the journal entry necessary to record this increase in fair value.