In the current year, Company A made the following cash purchases: 1. The exclusive right to manufacture and sell equipment from Company B for $204,000. Company B created the unique design for the equipment. Company A also paid an additional $12,000 in legal and filing fees to attorneys to complete the transaction. 2. An initial fee of $265,000 for a three-year agreement with Company C to use its name for a new facility in the local area. Company C has locations throughout the country. Company A is required to pay an additional fee of $5,400 for each month it operates under the Company C name, with payments beginning in March of the current year. Company A also purchased $404,000 of equipment to be placed in the new facility. 3. The exclusive right to sell a book, for $23,000. Required: Prepare a summary journal entry to record expenditures related to initial acquisitions. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.

In the current year, Company A made the following cash purchases: 1. The exclusive right to manufacture and sell equipment from Company B for $204,000. Company B created the unique design for the equipment. Company A also paid an additional $12,000 in legal and filing fees to attorneys to complete the transaction. 2. An initial fee of $265,000 for a three-year agreement with Company C to use its name for a new facility in the local area. Company C has locations throughout the country. Company A is required to pay an additional fee of $5,400 for each month it operates under the Company C name, with payments beginning in March of the current year. Company A also purchased $404,000 of equipment to be placed in the new facility. 3. The exclusive right to sell a book, for $23,000. Required: Prepare a summary journal entry to record expenditures related to initial acquisitions. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 5PA: Jada Company had the following transactions during the year: Purchased a machine for $500,000 using...

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