Assume Tran accounts for the Lyon license as a five-year right to access Tran's symbolic intellectual property from April 1, 2021, throughMarch 31, 2026. Tran expects that its ongoing marketing efforts will affect the value of the license to Lyon during the five-year licenseperiod. Repeat requirements 2 and 3. (Do not round intermediate calculations. If no entry is required for a transaction/event, select "Nojournal entry required" in the first account field.)Show less AView transaction listJournal entry worksheet<2Record the entry for Tran to recognize any revenue that should be recognizedin 2021 with respect to the Lyon license that it has not already recognizedunder the new assumption.Note: Enter debits before credits.TransactionGeneral JournalDebitCredit2Cash1,000,000Deferred revenueLicense revenue Tran Technologies licenses its functional intellectual property to Lyon Industries. Terms of the arrangement require Lyon to pay Tran$500,000 on April 1, 2021, when Lyon first obtains access to Tran's intellectual property, and then in the future to pay Tran a royalty of4% of future sales of products that utilize that intellectual property. Tran anticipates receiving sales-based royalties of $1,000,000during 2021 and $1,500,000/year for the years 2022–2026. Assume Tran accounts for the Lyon license as a right of use, becauseTran's actions subsequent to April 1, 2021, will affect the benefits that Lyon receives from access to Tran's intellectual property.Required:1. Access the FASB Accounting Standards Codification at the FASB website (www.fasb.org). Identify the specific nine-digit Codificationcitation (XXX-XX-XX-XX) for accounting for variable consideration arising from sales-based royalties on licenses of intellectualproperty, and consider the relevant GAAP.2. What journal entry would Tran record on April 1, 2021, when it receives the $500,000 payment from Lyon?3. Assume on December 31, 2021, Tran receives $1,000,000 for all sales-based royalties from Lyon in 2021. What journal entry wouldTran record on December 31, 2021, to recognize any revenue that should be recognized in 2021 with respect to the Lyon licensethat it has not already recognized?4. Assume Tran accounts for the Lyon license as a five-year right to access Tran's symbolic intellectual property from April 1, 2021,through March 31, 2026. Tran expects that its ongoing marketing efforts will affect the value of the license to Lyon during the five-year license period. Repeat requirements 2 and 3.

Assume Tran accounts for the Lyon license as a five-year right to access Tran's symbolic intellectual property from April 1, 2021, through March 31, 2026. Tran expects that its ongoing marketing efforts will affect the value of the license to Lyon during the five-year license period. Repeat requirements 2 and 3. (Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Show less A View transaction list Journal entry worksheet < 1 2 Record the entry for Tran to recognize any revenue that should be recognized in 2021 with respect to the Lyon license that it has not already recognized under the new assumption.

Assume Tran accounts for the Lyon license as a five-year right to access Tran's symbolic intellectual property from April 1, 2021, through March 31, 2026. Tran expects that its ongoing marketing efforts will affect the value of the license to Lyon during the five-year license period. Repeat requirements 2 and 3. (Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Show less A View transaction list Journal entry worksheet < 1 2 Record the entry for Tran to recognize any revenue that should be recognized in 2021 with respect to the Lyon license that it has not already recognized under the new assumption.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The following transactions of Dunn Miles occurred during 2024: i (Click the icon to view the transactions.) Requirements 1. Journalize required transactions, if any, in Miles's general journal. Explanations are not required. What is the balance in Estimated Warranty Payable assuming a beginning balance of $0? 2. Requirement 1. Journalize required transactions, if any, in Miles's general journal. Explanations are not required. (Record debits first, then credits. Exclude explanations from journal entries. For transactions that do not require an entry, make sure to select "No entry required" in the first cell in the "Accounts" column and leave all other cells blank.) Apr. 30: Miles is party to a patent infringement lawsuit of $210,000. Miles's attorney is certain it is remote that Miles will lose this lawsuit. Date Accounts Debit Credit Apr. 30 More info Apr. 30 Jun. 30 Jul. 28 Sep. 30 Dec. 31 Miles is party to a patent infringement lawsuit of $210,000. Miles's attorney is certain it is…
Ivanhoe Steel Company, as lessee, signed a lease agreement for equipment for 5 years, beginning December 31, 2020. Annual rental payments of $53,000 are to be made at the beginning of each lease year (December 31). The interest rate used by the lessor in setting the payment schedule is 7%; Ivanhoe's incremental borrowing rate is 9%. Ivanhoe is unaware of the rate being used by the lessor. At the end of the lease, Ivanhoe has the option to buy the equipment for $5,000, considerably below its estimated fair value at that time. The equipment has an estimated useful life of 7 years, with no salvage value. Ivanhoe uses the straight-line method of depreciation on similar owned equipment. (a) Your answer is correct. Prepare the journal entries, that Ivanhoe should record on December 31, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Round…
Prepare 2020 entries for Carla assuming that the warranties are not an integral part of the sale (a service-type warranty). Assume that of the sales total, $53,000 relates to sales of warranty contracts.Warranty costs incurred in 2020 were $22,000. Estimate revenues to be recognized on a straight-line basis. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Round intermediate calculations to 5 decimal places, e.g. 1.54657 answers to O decimal places, e.g. 5,125. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit
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Wildhorse Company, a machinery dealer, leased a machine to Dexter Corporation on January 1, 2020. The lease is for an 8-year period and requires equal annual payments of $30,384 at the beginning of each year. The first payment is received on January 1, 2020. Wildhorse had purchased the machine during 2019 for $130,000. Collectibility of lease payments by Wildhorse is probable. Wildhorse set the annual rental to ensure a 6% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Wildhorse at the termination of the lease.
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During the current year, Dale Corporation sold a segment of its business at a gain of $315,000.Until it was sold, the segment had a current period operating loss of $112,500. The company had$1,275,000 from continuing operations for the current year.Prepare the lower part of the income statement, beginning with the $1,275,000 income fromcontinuing operations. Follow tax allocation procedures, assuming that all changes in incomeare subject to a 20% income tax rate. Disregard earnings per share disclosures. (Round all calculations to nearest dollar amount.)
Garrett Corporation began operations in 2021. To maintain its accounting records, Garrett entered into a two-year agreement with Accurite Company. The agreement specifies that Garrett will pay $85,000 to Accurite immediately, and in return, Accurite will make its accounting software accessible via the Internet to Garrett and maintain all infrastructure necessary to run the software and store records. At any time, Garrett Corporation can freely remove its records and run the software on its own hardware or that of another accounting services company. In addition to the cost of the agreement, Garrett incurred $15,000 early in the year devising a plan for its accounting software needs, $25,000 for customizing its own computers for integration with Accurite’s software, and $20,000 after the software was implemented to train its employees. Determine the initial amount that Garrett should capitalize related to the software development costs.