PEI Ltd. purchased a copyright on a new book series about the history of the Great Lakes in Ontario for $15,000 cash on August 1, 2020. PEI expects these books to have a saleable life of three years. One year later, on August 1, 2021, the company paid $6,000, successfully defending the copyright in court. The company's year end is July 31 and it prepares adjusting entries annually. Instructions Record the following journal entries: a) the purchase of the copyright on August 1, 2020. b) the amortization at July 31, 2021 c) the legal costs incurred on August 1, 2021.

PEI Ltd. purchased a copyright on a new book series about the history of the Great Lakes in Ontario for $15,000 cash on August 1, 2020. PEI expects these books to have a saleable life of three years. One year later, on August 1, 2021, the company paid $6,000, successfully defending the copyright in court. The company's year end is July 31 and it prepares adjusting entries annually. Instructions Record the following journal entries: a) the purchase of the copyright on August 1, 2020. b) the amortization at July 31, 2021 c) the legal costs incurred on August 1, 2021.

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter10: Cost Recovery On Property: Depreciation, Depletion, And Amortization

Section: Chapter Questions

Problem 62P

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