A business was purchased from an unrelated party for $250,000 at the beginning of 2015. Of this amount $80,000 was paid for a patent with a remaining life of 8 years, $90,000 covenant not to compete for 12 years, and the remaining amount is applicable to goodwill. What is the amount of the amortization deduction for 2015? a. $10,667. b. $16,667 c. $20,000. d. $32,667.
A business was purchased from an unrelated party for $250,000 at the beginning of 2015. Of this amount $80,000 was paid for a patent with a remaining life of 8 years, $90,000 covenant not to compete for 12 years, and the remaining amount is applicable to goodwill. What is the amount of the amortization deduction for 2015? a. $10,667. b. $16,667 c. $20,000. d. $32,667.
Chapter14: Property Transact Ions: Capital Gains And Losses, § 1231, And Recapture Provisions
Section: Chapter Questions
Problem 75P
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Hello tutor please provide correct answer general Accounting
Transcribed Image Text:A business was purchased from an unrelated party for $250,000 at the
beginning of 2015. Of this amount $80,000 was paid for a patent with
a remaining life of 8 years, $90,000 covenant not to compete for 12
years, and the remaining amount is applicable to goodwill. What is
the amount of the amortization deduction for 2015?
a. $10,667.
b. $16,667
c. $20,000.
d. $32,667.
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