close solutoin list

Acquisition and Amortization of Intangible Assets T LM Technologies had these transactions related to intangible assets during 2019. Jan. 2 Purchased a patent from Luna Industries for $175,000. The remaining legal life of the patent is 15 years, and TLM expects the patent to be useful for 8 years. Jan. 5 Paid legal fees in a successful legal defense of the patent of $90,000. June 29 Registered a trademark with the federal government. Registration costs were $4,000. T LM expects to use the trademark indefinitely. Sept. 2 Paid research and development costs of S478,200. Required: 1. Prepare the journal entries necessary to record the transactions. 2. Prepare the entries necessary to record amortization expense for the intangible assets. 3. What is the balance of the intangible assets at the end of 2019?

BuyFind

Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
Publisher: Cengage Learning
ISBN: 9781337690881
BuyFind

Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
Publisher: Cengage Learning
ISBN: 9781337690881

Solutions

Chapter
Section
Chapter 7, Problem 62E
Textbook Problem

Acquisition and Amortization of Intangible Assets

T LM Technologies had these transactions related to intangible assets during 2019.

Jan. 2 Purchased a patent from Luna Industries for $175,000. The remaining legal life of the patent is 15 years, and TLM expects the patent to be useful for 8 years.

Jan. 5 Paid legal fees in a successful legal defense of the patent of $90,000.

June 29 Registered a trademark with the federal government. Registration costs were $4,000. T LM expects to use the trademark indefinitely.

Sept. 2 Paid research and development costs of S478,200.

Required:

1. Prepare the journal entries necessary to record the transactions.

2. Prepare the entries necessary to record amortization expense for the intangible assets.

3. What is the balance of the intangible assets at the end of 2019?

Expert Solution

Want to see this answer and more?

Experts are waiting 24/7 to provide step-by-step solutions in as fast as 30 minutes!*

See Solution

*Response times vary by subject and question complexity. Median response time is 34 minutes and may be longer for new subjects.

Chapter 7 Solutions

Cornerstones of Financial Accounting
Show all chapter solutions
Ch. 7 - What accounting concepts should be considered when...Ch. 7 - What is the proper accounting for depreciation...Ch. 7 - How is the sale of equipment at an amount greater...Ch. 7 - What information does the fixed asset turnover...Ch. 7 - Describe the benefits that intangible assets...Ch. 7 - What factors should be considered when selecting...Ch. 7 - What basis underlies the computation of depletion?Ch. 7 - ( Appendix 7 A) What is an impairment of a fixed...Ch. 7 - Anniston Company purchased equipment and incurred...Ch. 7 - The cost principle requires that companies record...Ch. 7 - When depreciation is recorded each period, what...Ch. 7 - Refer to the information for Cox Inc. above. What...Ch. 7 - Refer to the information for Cox Inc. above. What...Ch. 7 - Refer to the information for Cox Inc. above. What...Ch. 7 - Which of the following statements is true...Ch. 7 - Normal repair and maintenance of an asset is an...Ch. 7 - Chapman Inc. purchased a piece of equipment in...Ch. 7 - Bradley Company purchased a machine for $34,000 on...Ch. 7 - Jerabek Inc. decided to sell one of its fixed...Ch. 7 - Which of the following statements is true? a. The...Ch. 7 - Which of the following is not an intangible asset?...Ch. 7 - Heston Company acquired a patent on January 1,...Ch. 7 - Howton Paper Company purchased $1,4,00,000 of...Ch. 7 - ( Appendix 7 A) Murnane Company purchased a...Ch. 7 - Cost of a Fixed Asset Borges Inc. recently...Ch. 7 - Acquisition Cost Cox Company recently purchased a...Ch. 7 - Straight-Line Depreciation Refer to the...Ch. 7 - Declining Balance Depreciation Refer to the...Ch. 7 - Units-of-Production Depreciation Refer to the...Ch. 7 - Revision of Depreciation On January 1, 2017, Slade...Ch. 7 - Disposal of an Operating Asset On August 30,...Ch. 7 - Analyze Fixed Assets At December 31, 2019, Clark...Ch. 7 - Cost of Intangible Assets Advanced Technological...Ch. 7 - Amortization of Intangible Assets MicroSystems...Ch. 7 - Depletion of Natural Resources Brandon Oil Company...Ch. 7 - (Appendix 7A) Impairment Brown Industries had two...Ch. 7 - Understanding Operating Assets Descriptions of...Ch. 7 - Acquisition Cost Desert State University installed...Ch. 7 - Depreciation Concepts Listed below are concepts...Ch. 7 - Depreciation Methods On January 1, 2019, Loeffler...Ch. 7 - Expenditures After Acquisition Listed below are...Ch. 7 - Revision of Depreciation On January 1, 2019, the...Ch. 7 - Disposal of an Operating Asset Jolie Company owns...Ch. 7 - Analyzing Fixed Assets Pitt reported the following...Ch. 7 - Cost and Amortization of Intangible Assets On...Ch. 7 - Natural Resources and Depletion Luper Company...Ch. 7 - ( Appendix 7A) Impairment Listed below is...Ch. 7 - Balance Sheet Presentation Listed below are items...Ch. 7 - Balance Sheet Classification Micro-Technologies...Ch. 7 - Acquisition Cost Items that may relate to...Ch. 7 - Cost of a Fixed Asset Laurel Cleaners purchased an...Ch. 7 - Cost of a Fixed Asset Colson Photography Service...Ch. 7 - Cost of Fixed Assets Mooney Sounds, a local stereo...Ch. 7 - Cost and Depreciation On January 1, 2019, Quick...Ch. 7 - Characteristics of Depreciation Methods Below is a...Ch. 7 - Depreciation Methods Berkshire Corporation...Ch. 7 - Depreciation Methods Clearcopy, a printing...Ch. 7 - Depreciation Methods Quick-as-Lightning, a...Ch. 7 - Inferring Original Cost Barton Construction...Ch. 7 - Choice Among Depreciation Methods Walnut Ridge...Ch. 7 - Revision of Depreciation On January 1, 2017,...Ch. 7 - Capital versus Revenue Expenditure Warrick Water...Ch. 7 - Expenditures After Acquisition The following...Ch. 7 - Expenditures After Acquisition Roanoke...Ch. 7 - Expenditures After Acquisition and Depreciation...Ch. 7 - Disposal of Fixed Asset Perfect Auto Rentals sold...Ch. 7 - Disposal of Fixed Asset Pacifica Manufacturing...Ch. 7 - Depreciation and Disposal of Fixed Assets Stanley...Ch. 7 - Analyze Fixed Assets Tabor Industries is a...Ch. 7 - Acquisition and Amortization of Intangible Assets...Ch. 7 - Balance Sheet Presentation The following...Ch. 7 - Amortization of Intangibles On January 1, 2019,...Ch. 7 - Depletion Rate Oxford Quarries purchased 45 acres...Ch. 7 - Depletion of Timber Bedford Ridge Development...Ch. 7 - (Appendix 7A) Impairment On January 1, 2012, the...Ch. 7 - Financial Statement Presentation of Operating...Ch. 7 - A Cost of a Fixed Asset Mist City Car Wash...Ch. 7 - Depreciation Methods Hansen Supermarkets purchased...Ch. 7 - Depreciation Schedules Wendt Corporation acquired...Ch. 7 - Expenditures After Acquisition Pasta, a restaurant...Ch. 7 - Repair Decision Clermont Transit operates a summer...Ch. 7 - Disposition of Fixed Assets In order to provide...Ch. 7 - Natural Resource and Intangible Accounting...Ch. 7 - Accounting for Intangible Assets On January 1,...Ch. 7 - Financial Statement Presentation of Operating...Ch. 7 - Cost of a Fixed Asset Metropolis Country Club...Ch. 7 - Depreciation Methods Graphic Design Inc. purchased...Ch. 7 - Depreciation Schedules Dunn Corporation acquired a...Ch. 7 - Expenditures After Acquisition Murrays Fish...Ch. 7 - Remodeling Decision Ferinni Company operates a...Ch. 7 - Disposition of Operating Assets Salva Pest Control...Ch. 7 - Natural Resource and Intangible Accounting In...Ch. 7 - Accounting for Intangible Assets Blackford and...Ch. 7 - Ethics, Internal Controls, and the Capitalization...Ch. 7 - Ethics, Internal Controls, and the Capitalization...Ch. 7 - Managements Depreciation Decision Great Basin...Ch. 7 - Managements Depreciation Decision Great Basin...Ch. 7 - Effect of Estimates of Life and Residual Value on...Ch. 7 - Effect of Estimates of Life and Residual Value on...Ch. 7 - Effect of Estimates of Life and Residual Value on...Ch. 7 - Research and Analysis Using the Annual Report...Ch. 7 - Research and Analysis Using the Annual Report...Ch. 7 - Research and Analysis Using the Annual Report...Ch. 7 - Research and Analysis Using the Annual Report...Ch. 7 - Research and Analysis Using the Annual Report...Ch. 7 - Research and Analysis Using the Annual Report...Ch. 7 - Research and Analysis Using the Annual Report...Ch. 7 - Research and Analysis Using the Annual Report...Ch. 7 - Comparative Analysis: Under Armour, Inc., versus...Ch. 7 - Comparative Analysis: Under Armour, Inc., versus...Ch. 7 - Comparative Analysis: Under Armour, Inc., versus...Ch. 7 - CONTINUING PROBLEM: FRONT ROW ENTERTAINMENT After...Ch. 7 - CONTINUING PROBLEM: FRONT ROW ENTERTAINMENT After...Ch. 7 - CONTINUING PROBLEM: FRONT ROW ENTERTAINMENT After...Ch. 7 - CONTINUING PROBLEM: FRONT ROW ENTERTAINMENT After...

Additional Business Textbook Solutions

Find more solutions based on key concepts
Show solutions
What is a relation? What is a tuple?

Accounting Information Systems

What is job specification?

Foundations of Business (MindTap Course List)

What is an after-action review? When is it performed? Why is it done?

Principles of Information Security (MindTap Course List)

In a brief report, discuss why we need various modes of transportation. How did they evolve? Discuss the role o...

Engineering Fundamentals: An Introduction to Engineering (MindTap Course List)

Determine the resultant of the position vectors A and B.

International Edition---engineering Mechanics: Statics, 4th Edition

A dedicated server that backs up and restores files, folders, and media is referred to as a _____. (116) a. web...

Enhanced Discovering Computers 2017 (Shelly Cashman Series) (MindTap Course List)

What does recognition mean in accounting?

Intermediate Accounting: Reporting And Analysis

What are the three steps to follow in preparing a bank reconciliation?

College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)

Define depreciation as it relates to a van you bought for your business.

College Accounting (Book Only): A Career Approach

How do unions affect the natural rate of unemployment?

Principles of Macroeconomics (MindTap Course List)

What is the index of leading indicators? Why is it useful to macro policy-makers?

Macroeconomics: Private and Public Choice (MindTap Course List)

RESIDUAL DIVIDEND MODEL Welch Company is considering three independent projects, each of which requires a 5 mil...

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)