On January 1, 2015, Epstein completed the acquisition of the Johnstone Corporation for $2,000,000 in cash. The fair value of the net assets of Johnstone was $1,700,000. Included in the assets purchased from Johnstone was a patent that was valued at $80,000. The remaining legal life of the patent was 13 years, but Epstein believes that the patent will only be useful for another eight (8) years. What is the total amount of intangible assets reported on the company's December 31, 2015 balance sheet? a. $10,000 b. $70,000 c. $300,000 d. $370,000
On January 1, 2015, Epstein completed the acquisition of the Johnstone Corporation for $2,000,000 in cash. The fair value of the net assets of Johnstone was $1,700,000. Included in the assets purchased from Johnstone was a patent that was valued at $80,000. The remaining legal life of the patent was 13 years, but Epstein believes that the patent will only be useful for another eight (8) years. What is the total amount of intangible assets reported on the company's December 31, 2015 balance sheet? a. $10,000 b. $70,000 c. $300,000 d. $370,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On January 1, 2015, Epstein completed the acquisition of
the Johnstone Corporation for $2,000,000 in cash. The fair
value of the net assets of Johnstone was $1,700,000.
Included in the assets purchased from Johnstone was a
patent that was valued at $80,000. The remaining legal life
of the patent was 13 years, but Epstein believes that the
patent will only be useful for another eight (8) years. What
is the total amount of intangible assets reported on the
company's December 31, 2015 balance sheet?
a. $10,000
b. $70,000
c. $300,000
d. $370,000
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