In 2021, the company successfully defends the patent in extended litigation at a cost of $44,800, thereby extending the patent life to December 31, 2028. What is the proper way to account for this cost? Also, record patent amortization (full year) in 2021. (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.) Account Titles and Explanation Debit Credit

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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In 2021, the company successfully defends the patent in extended litigation at a cost of $44,800, thereby extending the patent life
to December 31, 2028. What is the proper way to account for this cost? Also, record patent amortization (full year) in 2021.
(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.)
Account Titles and Explanation
(To record legal cost of successfully defending patent)
(To record one year's amortization)
Debit
Credit
Transcribed Image Text:In 2021, the company successfully defends the patent in extended litigation at a cost of $44,800, thereby extending the patent life to December 31, 2028. What is the proper way to account for this cost? Also, record patent amortization (full year) in 2021. (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.) Account Titles and Explanation (To record legal cost of successfully defending patent) (To record one year's amortization) Debit Credit
Sheridan Company from time to time embarks on a research program when a special project seems to offer possibilities. In 2019, the
company expends $323,000 on a research project, but by the end of 2019 it is impossible to determine whether any benefit will be
derived from it.
Transcribed Image Text:Sheridan Company from time to time embarks on a research program when a special project seems to offer possibilities. In 2019, the company expends $323,000 on a research project, but by the end of 2019 it is impossible to determine whether any benefit will be derived from it.
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