I need correct answer general accounting question Granite Enterprises acquired a patent from SouthernResearch Corporation on 1/1/09 for $4 million. The patentwill be used for five years, even though its legal life is 20years. Rocky Corporation has made a commitment topurchase the patent from Granite for $200,000 at the endof five years. Compute Granite's patent amortization for2009, assuming the straight-line method is used.A. $380,000B. $400,000C. $760,000D. $800,000

Step 1: Define Intangible AssetsIntangible assets include patents, trademarks, copyrights, goodwill,…

Answered: Granite Enterprises acquired a patent…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 6EA: Calico Inc. purchased a patent on a new drug. The patent cost $21,000. The patent has a life of...

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Calico Inc. purchased a patent on a new drug it created. The patent cost $12,000. The patent has a life of twenty years, but Calico expects to be able to sell the drug for fifty years. Calculate the amortization expense and record the journal for the first years expense.
For each of the following unrelated situations, calculate the annual amortization expense and prepare a journal entry to record the expense: A. A patent with a seventeen-year remaining legal life was purchased for $850,000. The patent will be usable for another six years. B. A patent was acquired on a new tablet. The cost of the patent itself was only $12,000, but the market value of the patent is $150,000. The company expects to be able to use this patent for all twenty years of its life.
For each of the following unrelated situations, calculate the annual amortization expense and prepare a journal entry to record the expense: A. A patent with a ten-year remaining legal life was purchased for $300,000. The patent will be usable for another eight years. B. A patent was acquired on a new smartphone. The cost of the patent itself was only $24,000, but the market value of the patent is $600,000. The company expects to be able to use this patent for all twenty years of its life.
Granite Enterprises acquired a patent from Southern Research Corporation on January 1, 2024, for $3.5 million. The patent will be used for five years, even though its legal life is 20 years. Rocky Corporation has made a commitment to purchase the patent from Granite for $260,000 at the end of five years. Assuming the straight-line method is used, what is Granite's patent amortization for 2024? Multiple Choice $324,000 $350,000 $648,000 $700,000
On March 1, 2020, Tebow Company purchased a patent for $158,000 cash. Although the patent gives legal protection for 19 years, the patent will be used for only 2 years. Assume straight-line amortization. Amortization per unit (Cost Res. Value)/Time = Amortization per year Amortization per year X portion of year = Amortization Journalize a) the purchase of the patent, and b) the amortization expense of the patent as of December 31, 2020. Date a b Check All Parts Description Debit Credit
On January 1, 20X3, Enid Corporation purchased a patent from another company for $190,000. The estimated useful life of the patent is 10 years, and its remaining legal life is 15 years. The amortization expense for 20X3 is: Question 5 options: $12,667. $85,000. $68,000. $19,000.
Sandhill Company acquired a patent on an oil extraction technique on January 1, 2025 for $7300000. It was expected to have a 10- year life and no residual value. Sandhill uses straight-line amortization for patents. On December 31, 2026, the future cash flows expected from the patent were $840000 per year for the next eight years. The fair value of the patent is $4100000. At what amount should the patent be carried on the December 31, 2026 balance sheet? O $5840000. O $7300000. O $4100000. O $6720000.
Taylor Swift Corporation purchases a patent from Salmon Company on January 1, 2025, for $54,000. The patent has a remaining legal life of 16 years. Taylor Swift estimates the patent will have a useful life of 10 years, based on expected product innovations in the market. Prepare Taylor Swift's journal entries to record the purchase of the patent and 2025 amortization. (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. List all debit entries before credit entries.) Account Titles and Explanation Patents cash (To record purchase of patents) Amortization Expense Patents (To record amortization of patents) Debit 24,000 8400 Credit 24,000 24,000
Bear Web Securities acquired a patent on January 1, 2022 for $68,000. The patent is expected to be of benefit to Bear for 6 years. After using the patent for two year it was determined that an advancement by a competitor would make the patent worthless in 3 years. Required: 1. Record the acquisition of the patent. 2. Record the patents amortization for 2022, 2023, and 2024.
Ayayai Corporation purchases a patent from Blossom Company on January 1, 2025, for $63,000. The patent has a remaining legal life of 14 years. Ayayai estimates the patent will have a useful life of 10 years, based on expected product innovations in the market. Prepare Ayayai's journal entries to record the purchase of the patent and 2025 amortization. (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. List all debit entries before credit entries.) Account Titles and Explanation (To record purchase of patents) (To record amortization of patents) Debit Credit
1. Pharoah purchased a patent from Vania Co. for $2,700,000 on January 1, 2018. The patent is being amortized over its remaining legal life of 10 years, expiring on January 1, 2028. During 2020, Pharoah determined that the economic benefits of the patent would not last longer than 7 years from the date of acquisition. What amount should be reported in the balance sheet for the patent, net of accumulated amortization, at December 31, 2020? The amount to be reported 2$ 2. Pharoah bought a franchise from Alexander Co. on January 1, 2019, for $979,000. The carrying amount of the franchise on Alexander's books on January 1, 2019, was $635,000. The franchise agreement had an estimated useful life of 20 years. Because Pharoah must enter a competitive bidding at the end of 2028, it is unlikely that the franchise will be retained beyond 2028. What amount should be amortized for the year ended December 31, 2020? The amount to be amortized 3. On January 1, 2020, Pharoah incurred organization…
A company acquired patent right on July 1, 2018 for P2,000,000. The asset has a legal life of 15 years but due to the rapidly changing technology management estimates a useful life of only 5 years. On January 1, 2019, management is uncertain that the process can actually be made economically feasible, and decides to write down the patent to an estimated market value of P600,000. Amortization will be taken three years from this time. On January 1, 2020, after having perfected the related production process, the asset is now appraised at a sound value of P2,400,000. Furthermore, the estimated useful life is now believed to have extended by six more years. The company uses the straight-line method of amortization. Instructions: Compute for the following: Amortization expense for 2018. Impairment loss to be recognized in 2019 Patent carrying value at December 31, 2019 Revaluation surplus recognized in 2020.

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