During 2018, Matsumura Ltd. spent ¥170,000 in research costs. As a result, a new product called the New Age Piano was patented. The patent was obtained on October 1, 2018, and had a legal life of 20 years and a useful life of 10 years. Legal costs of ¥24,000 related to the patent were incurred as of October 1, 2018. (Amounts are in thousands.) Required: 1. Prepare all journal entries required in 2018 and 2019 as a result of the transactions above. 2. On June 1, 2020, Matsumura spent ¥12,400 to successfully prosecute a patent infringement suit. As a result, the estimate of useful life was extended to 12 years from June 1, 2020. Prepare all journal entries required in 2020 and 2021. 3. In 2022, Matsumura determined that a competitor's product would make the New Age Piano obsolete and the patent worthless by December 31, 2023. Prepare all journal entries required in 2022 and 2023.
During 2018, Matsumura Ltd. spent ¥170,000 in research costs. As a result, a new product
called the New Age Piano was patented. The patent was obtained on October 1, 2018, and had
a legal life of 20 years and a useful life of 10 years. Legal costs of ¥24,000 related to the patent
were incurred as of October 1, 2018. (Amounts are in thousands.)
Required:
1. Prepare all
above.
2. On June 1, 2020, Matsumura spent ¥12,400 to successfully prosecute a patent
infringement suit. As a result, the estimate of useful life was extended to 12 years from June 1,
2020. Prepare all journal entries required in 2020 and 2021.
3. In 2022, Matsumura determined that a competitor's product would make the New Age
Piano obsolete and the patent worthless by December 31, 2023. Prepare all journal entries
required in 2022 and 2023.
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