Textbook Problem

INTANGIBLE LONG-TERM ASSETS B. J. Bakery had the following transactions involving intangible assets:

Jan.	1	Purchased a patent for a new pastry for $10,000 and estimated its useful life to be 10 years.
Apr.	1	Purchased a copyright for a cookie cutter design for $5,000 with a life left on the copyright of 15 years. Estimated that the future remaining (economic) life of the copyright is five years.
July	1	Signed a five-year franchise agreement and opened a Raisabon Bakery. Paid $40,000 to the franchisor.

REQUIRED

1. 1. Using the straight-line method, calculate the amortization of the patent, copyright, and franchise.
2. 2. Prepare journal entries to record the end-of-year amortizations using a general journal.