Bev bought a small mom and pop grocery store. The sale was completed and Bev obtained ownership on July 1, 2021. The total cost of the store was $500,000. Of this $100,000 was allocated to Goodwill and $120,000 was allocated to a Covenant Not to Compete the sellers agreed to. The remaining cost was allocated to the building and inventory. Calculate Bev's Section 197 intangibles and the amortization she can claim for 2021.

Bev bought a small mom and pop grocery store. The sale was completed and Bev obtained ownership on July 1, 2021. The total cost of the store was $500,000. Of this $100,000 was allocated to Goodwill and $120,000 was allocated to a Covenant Not to Compete the sellers agreed to. The remaining cost was allocated to the building and inventory. Calculate Bev's Section 197 intangibles and the amortization she can claim for 2021.

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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