(b)Prepare the December 31 entry for Pronghorn Corporation to record amortization of intangibles. The trademark has anestimated useful life of 4 years with a residual value of $4,920. (Credit account titles are automatically indented when amount isentered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List debit entrbefore credit entry.)Account Titles and ExplanationeTextbook and MediaDebitAttempts: 1 of 3 useCredit View PoliciesShow Attempt HistoryCurrent Attempt in ProgressOn July 1, 2025, Pronghorn Corporation purchased Young Company by paying $252,100 cash and issuing a $146,000 note payable toSteve Young. At July 1, 2025, the balance sheet of Young Company was as follows.CashAccounts receivableInventoryLandBuildings (net)Equipment (net)Trademarks$50,90091,600107,00041,60075,60069,90011,600$448,200Accounts payableStockholders' equity$205,000243,200$448,200The recorded amounts all approximate current values except for land (fair value of $60,100), inventory (fair value of $124,500), andtrademarks (fair value of $16,080).

Journal entry is the primary reporting of the business transactions in the books. These entries are…

On July 1, 2025, Pronghorn Corporation purchased Young Company by paying $252,100 cash and issuing a $146,000 note payable to Steve Young. At July 1, 2025, the balance sheet of Young Company was as follows. Cash Accounts receivable Inventory Land Buildings (net) Equipment (net) Trademarks $50,900 91,600 107,000 41,600 75,600 69,900 11,600 $448,200 Accounts payable Stockholders' equity $205,000 243,200 $448,200 The recorded amounts all approximate current values except for land (fair value of $60,100), inventory (fair value of $124,500), and trademarks (fair value of $16,080).

On July 1, 2025, Pronghorn Corporation purchased Young Company by paying $252,100 cash and issuing a $146,000 note payable to Steve Young. At July 1, 2025, the balance sheet of Young Company was as follows. Cash Accounts receivable Inventory Land Buildings (net) Equipment (net) Trademarks $50,900 91,600 107,000 41,600 75,600 69,900 11,600 $448,200 Accounts payable Stockholders' equity $205,000 243,200 $448,200 The recorded amounts all approximate current values except for land (fair value of $60,100), inventory (fair value of $124,500), and trademarks (fair value of $16,080).

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter3: The Basics Of Record Keeping And Financial Statement Preparation: Income Statement

Section: Chapter Questions

Problem 19E

See similar textbooks

Similar questions

At the end of 2020, while auditing Sandlin Companys books, before the books have been closed, you find the following items: a. A building with a 30-year life (no residual value, depreciated using the straight-line method) was purchased on January 1, 2020, by issuing a 90,000 non-interest-bearing, 4-year note. The entry made to record the purchase was a debit to Building and a credit to Notes Payable for 90,000; 12% is a fair rate of interest on the note. b. The inventory at the end of 2020 was found to be overstated by 15,000. At the same time, it was discovered that the inventory at the end of 2019 had been overstated by 35,000. The company uses the perpetual inventory system. c. For the last 3 years, the company has failed to accrue salaries and w-ages. The correct amounts at the end of each year were: 2018, 12,000; 2019, 18,000; and 2020, 10,000. Required: 1. Prepare journal entries to correct the errors. Ignore income taxes. 2. Assume, instead, that the company discovered the errors after it had closed the books. Prepare journal entries to correct the errors. Ignore income taxes.
Albany Corporation purchased equipment at the beginning of Year 1 for 75,000. The asset does not have a residual value and is estimated to be in service for 8 years. Calculate the depreciation expense for Years 1 and 2 using the double-declining-balance method. Round to the nearest dollar.
The following are independent errors: a. In January 2019, repair costs of 9,000 were debited to the Machinery account. At the beginning of 2019, the book value of the machinery was 100,000. No residual value is expected, the remaining estimated life is 10 years, and straight-line depreciation is used. b. All purchases of materials for construction contracts still in progress have been immediately expensed. It is discovered that the use of these materials was 10,000 during 2018 and 12,000 during 2019. c. Depreciation on manufacturing equipment has been excluded from manufacturing costs and treated as a period expense. During 2019, 40,000 of depreciation was accounted for in that manner. Production was 15,000 units during 2019, of which 3,000 remained in inventory at the end of the year. Assume there was no inventory at the beginning of 2019. Required: Prepare journal entries for the preceding errors discovered during 2020. Ignore income taxes.
During 2019, Ryel Companys controller asked you to prepare correcting journal entries for the following three situations: 1. Machine A was purchased for 50,000 on January 1, 2014. Straight-line depreciation has been recorded for 5 years, and the Accumulated Depreciation account has a balance of 25,000. The estimated residual value remains at 5,000, but the service life is now estimated to be 1 year longer than estimated originally. 2. Machine B was purchased for 40,000 on January 1, 2017. It had an estimated residual value of 5,000 and an estimated service life of 10 years. it has been depreciated under the double-declining-balance method for 2 years. Now, at the beginning of the third year, Ryel has decided to change to the straight-line method. 3. Machine C was purchased for 20,000 on January 1, 2018, Double-declining-balance depreciation has been recorded for 1 year. The estimated residual value of the machine is 2,000 and the estimated service life is 5 years. The computation of the depreciation erroneously included the estimated residual value. Required: Prepare any necessary correcting journal entries for each situation. Also prepare the journal entry necessary for each situation to record depreciation expense for 2019.
On April 1, a patent with an estimated useful economic life of 12 years was acquired for $100,800. In addition, on December 31, it was estimated that goodwill of $55,500 was impaired. a. Record the acquisition of patent. If an amount box does not require an entry, leave it blank. b. Journalize the adjusting entry on December 31 for the amortization of the patent rights. Do not round intermediate calculations. If an amount box does not require an entry, leave it blank. c. Journalize the adjusting entry on December 31 for the impaired goodwill. If an amount box does not require an entry, leave it blank.
On January 2, 2021, Teal Mountain Company purchased a patent for $47,800. The patent has an estimated useful life of 25 years and a 20-year legal life.What entry would the company make at December 31, 2021 to record amortization expense on the patent? (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
On December 31, it was estimated that goodwill of $1,600,000 was impaired. In addition, a patent with an estimated useful economic life of 15 years was acquired for $594,000 on August 1. B. Journalism the adjusting entry on December 31 for the amortization of the patent rights. If an amount box does not require an entry, leave it blank.
A machine cost $229,000, has annual depreciation expense of $45,800, and has accumulated depreciation of $114,500 on December 31, 2020. On April 1, 2021, when the machine has a fair value of $91,210, it is exchanged for a similar machine with a fair value of $291,900 and the proper amount of cash is paid. The exchange lacked commercial substance.Prepare all entries that are necessary at April 1, 2021. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit April 1, 2021 (To record depreciation) April 1, 2021 (To record exchange of machineries)
At the end of 2022, Neck Company discovered that patent amortization expense of $222,000 had not been recorded in 2021 or 2022. If Neck has not closed the books for 2022, the journal entry to correct the error will Answer a. a debit to Retained Earnings and a credit to Patent for $444,000. b. a debit to Amortization Expense and a credit to Patent for $444,000. c. a debit to Amortization Expense and a credit to Patent for $222,000. d. include debits to Retained Earnings and Amortization Expense of $222,000 and a credit to Patent for $444,000.
On April 1, a patent with an estimated useful economic life of 12 years was acquired for $57,600. In addition, on December 31, it was estimated that goodwill of $35,000 was impaired. a. Record the acquisition of patent. If an amount box does not require an entry, leave it blank. b. Journalize the adjusting entry on December 31 for the amortization of the patent rights. Do not round intermediate calculations. If an amount box does not require an entry, leave it blank. Dec. 31
Windsor Company owns equipment that cost $972,000 and has accumulated depreciation of $410,400. The expected future net cash flows from the use of the asset are expected to be $540,000. The fair value of the equipment is $432,000.Prepare the journal entry, if any, to record the impairment loss. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount
Martinez Company owns equipment that cost $1,053,000 and has accumulated depreciation of $444,600. The expected future net cash flows from the use of the asset are expected to be $585,000. The fair value of the equipment is $468,000.Prepare the journal entry, if any, to record the impairment loss. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit