XYZ Corporation incurred the following costs in 2020: • XYZ Corporation purchased a patent from ABC Company for $12,000,000 on March 1, 2020. The estimated remaining useful life of the patent is 8 years. • XYZ Corporation incurred the following research and development costs related to its trademark. Personnel Materials Supplies $30,000 10,000 5,000 C. XYZ Corporation purchased a franchise from DEF Company for $1,000,000 on August 1, 2020. The contract of the franchise is for 10 years. Instructions: A. Calculate the amortization for 2020. B. Calculate the total expenses reported on the Income Statement for the year ended December 31, 2020. C. Determine the total intangible assets of XYZ Corporation to be reported on the Balance Sheet at December 31, 2020.

XYZ Corporation incurred the following costs in 2020: • XYZ Corporation purchased a patent from ABC Company for $12,000,000 on March 1, 2020. The estimated remaining useful life of the patent is 8 years. • XYZ Corporation incurred the following research and development costs related to its trademark. Personnel Materials Supplies $30,000 10,000 5,000 C. XYZ Corporation purchased a franchise from DEF Company for $1,000,000 on August 1, 2020. The contract of the franchise is for 10 years. Instructions: A. Calculate the amortization for 2020. B. Calculate the total expenses reported on the Income Statement for the year ended December 31, 2020. C. Determine the total intangible assets of XYZ Corporation to be reported on the Balance Sheet at December 31, 2020.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 11EB: The following intangible assets were purchased by Hanna Unlimited: A. A patent with a remaining...

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