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

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College Accounting, Chapters 1-27 ...

22nd Edition
James A. Heintz + 1 other
Publisher: Cengage Learning
ISBN: 9781305666160
BuyFind

College Accounting, Chapters 1-27 ...

22nd Edition
James A. Heintz + 1 other
Publisher: Cengage Learning
ISBN: 9781305666160

Solutions

Chapter
Section
Chapter 18, Problem 13SPB
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.

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Chapter 18 Solutions

College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)
Ch. 18 - The following costs were incurred to purchase a...Ch. 18 - The following information is provided for a...Ch. 18 - LO3 A machine costing 350,000 has a salvage value...Ch. 18 - Grandorf Company replaced the engine in a truck...Ch. 18 - Prepare journal entries for the following...Ch. 18 - Popilarz Mining acquired a coal mine at a cost of...Ch. 18 - Todd Company purchased a patent with a remaining...Ch. 18 - What costs should be included when measuring the...Ch. 18 - How should the cost of such activities as planting...Ch. 18 - What are the two major types of depreciation?Ch. 18 - What is meant by the depreciable cost of a plant...Ch. 18 - What are the four most commonly used methods of...Ch. 18 - Which depreciation method provides the fastest...Ch. 18 - Explain how the depreciation method selected...Ch. 18 - For assets acquired after 1986, what depreciation...Ch. 18 - How should additions or improvements representing...Ch. 18 - Explain what is meant by the replacement of a...Ch. 18 - What are the three major ways of disposing of a...Ch. 18 - For what time interval should depreciation expense...Ch. 18 - When a plant asset is sold, what must be known...Ch. 18 - What details about a particular asset are provided...Ch. 18 - What is the purpose of depletion?Ch. 18 - Which depreciation method is similar to the method...Ch. 18 - Over what period of time should the cost of a...Ch. 18 - How should the unamortized portion of the cost of...Ch. 18 - What is a trademark?Ch. 18 - What is a franchise? Name a franchise you have...Ch. 18 - What is goodwill? When is it recognized?Ch. 18 - What is impairment?Ch. 18 - COST OF PROPERTY, PLANT, AND EQUIPMENT Consider...Ch. 18 - STRAIGHT-LINE, DECLINING-BALANCE, AND...Ch. 18 - UNITS-OF-PRODUCTION METHOD The truck purchased in...Ch. 18 - JOURNAL ENTRIES: REPAIRS, MAINTENANCE, ADDITIONS,...Ch. 18 - JOURNAL ENTRIES: DISPOSITION OF PLANT ASSETS...Ch. 18 - DEPLETION Prepare the following entries using a...Ch. 18 - STRAIGHT-LINE, DECLINING-BALANCE,...Ch. 18 - UNITS-OF-PRODUCTION METHOD A machine is purchased...Ch. 18 - CALCULATING AND JOURNALIZING DEPRECIATION...Ch. 18 - IMPACT OF IMPROVEMENTS AND REPLACEMENTS ON THE...Ch. 18 - DISPOSITION OF ASSETS: JOURNALIZING Mitchell Parts...Ch. 18 - DEPLETION: CALCULATING AND JOURNALIZING Mineral...Ch. 18 - INTANGIBLE LONG-TERM ASSETS Track Town Co. had the...Ch. 18 - COST OF PROPERTY, PLANT, AND EQUIPMENT Lam Company...Ch. 18 - STRAIGHT-LINE, DECLINING-BALANCE, AND...Ch. 18 - UNITS-OF-PRODUCTION METHOD The truck purchased in...Ch. 18 - JOURNAL ENTRIES: REPAIRS, MAINTENANCE, ADDITIONS,...Ch. 18 - JOURNAL ENTRIES: DISPOSITION OF PLANT ASSETS...Ch. 18 - DEPLETION Prepare the following entries using a...Ch. 18 - STRAIGHT-LINE, DECLINING-BALANCE,...Ch. 18 - UNITS-OF-PRODUCTION METHOD A machine is purchased...Ch. 18 - CALCULATING AND JOURNALIZING DEPRECIATION...Ch. 18 - IMPACT OF IMPROVEMENTS AND REPLACEMENTS ON THE...Ch. 18 - DISPOSITION OF ASSETS: JOURNALIZING Mayer Delivery...Ch. 18 - DEPLETION: CALCULATING AND JOURNALIZING Mining...Ch. 18 - INTANGIBLE LONG-TERM ASSETS B. J. Bakery had the...Ch. 18 - A friend owns and operates her own business and is...Ch. 18 - Creative Solutions purchased a patent from Russell...Ch. 18 - On April 1, 20-3, Kwik Kopy Printing purchased a...Ch. 18 - Don Burnette is starting a new home planning...

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