3- During 2018, Matsumura Ltd. Spent ¥180,000 in research costs. As a result, a new product called the New Age Piano was patented. The patent was obtained on October 31, 2018, and had a legal life of 20 years and a useful life of 9 years. Legal costs of ¥25,000 related to the patent were incurred as of October 31, 2018. (Amounts are in thousands.) Instructions Prepare all journal entries required in 2018 and 2019 as a result of the transactions above.
3- During 2018, Matsumura Ltd. Spent ¥180,000 in research costs. As a result, a new product called the New Age Piano was patented. The patent was obtained on October 31, 2018, and had a legal life of 20 years and a useful life of 9 years. Legal costs of ¥25,000 related to the patent were incurred as of October 31, 2018. (Amounts are in thousands.) Instructions Prepare all journal entries required in 2018 and 2019 as a result of the transactions above.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
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3- During 2018, Matsumura Ltd. Spent ¥180,000 in research costs. As a result, a new product called the New Age Piano was patented. The patent was obtained on October 31, 2018, and had a legal life of 20 years and a useful life of 9 years. Legal costs of ¥25,000 related to the patent were incurred as of October 31, 2018. (Amounts are in thousands.)
Instructions
Prepare all journal entries required in 2018 and 2019 as a result of the transactions above.
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