On January 1, 2011, the account balances of Miami Company showed patent cost of P1,920,000 and related accumulated amortization of P240,000. The patent was purchased on January 1, 2009 at which date the remaining legal life was 16 years. On January 1, 2011,
On January 1, 2011, the account balances of Miami Company showed patent cost of
P1,920,000 and related accumulated amortization of P240,000. The patent was purchased
on January 1, 2009 at which date the remaining legal life was 16 years. On January 1, 2011,
the useful life of the patent was determined to be 8 years from the date of acquisition.
On January 1, 2011, Miami paid P800,000, of which three-fourths was for a trademark and
one-fourth was for the other entity’s agreement not to compete for a 5-year period in the line
of business covered by the trademark. Miami considers the life of the trademark indefinite.
Moreover, Miami agreed to pay P50,000 to the other entity as consulting fee each year for 5
years payable every January 1.
Question: What is the amortization of intangible assets for 2011?
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