Van Frank Telecommunications has a patent on a cellular transmission process. The company has amortized thepatent on a straight-line basis since 2014, when it was acquired at a cost of $9 million at the beginning of thatyear. Due to rapid technological advances in the industry, management decided that the patent would benefit thecompany over a total of six years rather than the nine-year life being used to amortize its cost. The decision wasmade at the beginning of 2018.Required:Prepare the year-end journal entry for patent amortization in 2018. No amortization was recorded during the year.
Van Frank Telecommunications has a patent on a cellular transmission process. The company has amortized thepatent on a straight-line basis since 2014, when it was acquired at a cost of $9 million at the beginning of thatyear. Due to rapid technological advances in the industry, management decided that the patent would benefit thecompany over a total of six years rather than the nine-year life being used to amortize its cost. The decision wasmade at the beginning of 2018.Required:Prepare the year-end journal entry for patent amortization in 2018. No amortization was recorded during the year.
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 7MC
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Van Frank Telecommunications has a patent on a cellular transmission process. The company has amortized the
patent on a straight-line basis since 2014, when it was acquired at a cost of $9 million at the beginning of that
year. Due to rapid technological advances in the industry, management decided that the patent would benefit the
company over a total of six years rather than the nine-year life being used to amortize its cost. The decision was
made at the beginning of 2018.
Required:
Prepare the year-end
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