Last year T, Inc., had the following expenditures related to developing its trademark: General advertising costs Advertising specifically focused on trademark Legal fees to register trademark Legal fees for successful defense of new trademark $224,000 45,500 600 75,000 Total $344,600 During your year-end review of the accounts related to intangibles, you discover that the company has capitalized all the above as costs of the trademark. Management contends that all the costs increase the value of the trademark and, therefore, should be capitalized. 31. Which of the above costs should NOT be capitalized? 32. S What is the total cost that should be capitalized to the trademark account?
Last year T, Inc., had the following expenditures related to developing its trademark: General advertising costs Advertising specifically focused on trademark Legal fees to register trademark Legal fees for successful defense of new trademark $224,000 45,500 600 75,000 Total $344,600 During your year-end review of the accounts related to intangibles, you discover that the company has capitalized all the above as costs of the trademark. Management contends that all the costs increase the value of the trademark and, therefore, should be capitalized. 31. Which of the above costs should NOT be capitalized? 32. S What is the total cost that should be capitalized to the trademark account?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Use the following to answer questions 31 - 32
Last year T, Inc., had the following expenditures related
to developing its trademark:
$224,000
45,500
600
75,000
Total $344,600
General advertising costs
Advertising specifically focused on trademark
Legal fees to register trademark
Legal fees for successful defense of new trademark
During your year-end review of the accounts related to
intangibles, you discover that the company has
capitalized all the above as costs of the trademark.
Management contends that all the costs increase the
value of the trademark and, therefore, should be
capitalized.
31. Which of the above costs should NOT be
capitalized?
32. $
What is the total cost that should be
capitalized to the trademark account?
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