How much is the annual amortization expense for 2022 on these financial accounting question? On January 2, 2022, BrightTech Corporation purchased a patentfor $320,000 plus $10,000 in legal fees. On that date, the patenthad a remaining legal life of 15 years. However, BrightTechCorporation expects to use the patent for only 6 years, after whichit will have no residual value.How much is the annual amortization expense for 2022?

To calculate the annual amortization expense for the patent, follow these steps: Determine the total…

Answered: On January 2, 2022, BrightTech…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 10PB: For each of the following unrelated situations, calculate the annual amortization expense and...

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Crane Manufacturing Company acquired a patent on a manufacturing process on January 1, 2020 for $5550000. It was expected to have a 10 year life and no residual value. Crane uses straight-line amortization for patents. On December 31, 2021, the future cash flows expected from the patent were $510000 per year for the next eight years. The present value of these cash flows, discounted at Crane's market interest rate, is $2675000. At what amount should the patent be carried on the December 31, 2021 balance sheet? $4080000. $5550000. $4440000. $2675000.
A company buys an oil rig for $2,400,000 on January 1, 2018. The life of the rig is 10 years and the expected cost to dismantle the rig at the end of 10 years is $609,000 (present value at 12% is $196,080). 12% is an appropriate interest rate for this company. What expense should be recorded for 2018 as a result of these events?
Hello Corporation purchased a patent for $90,000 on September 1, 2020. It had a useful life of 10 years. On January 1, 2022, Hello spent $22,000 to successfully defend the patent in a lawsuit. Hello feels that as of that date, the remaining useful life is 5 years. Calculate the amount that should be reported for patent amortization expense for 2022.
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Ruby Ltd. purchased a patent for $450,000 on September 1, 2020. It had a useful life of 10 years. On January 1, 2022, Ruby spent $220,000 to successfully defend the patent in a lawsuit. Ruby feels that as of that date, the remaining useful life is 5 years. What amount should be reported for patent amortization expense for 2022? $
On January 1, 2020, Purple Inc. purchased a patent for $33, 300. Legal fees paid in this purchase amounted to $1,700. The legal remaining life of the patent is 14 years, but Purple believes it will only help increase sales for the next 10 years. On January 1, 2023, Purple was sued for patent infringement and had to spend $4,900 of legal fees in the successful defense of this patent. What is the book value of this patent on December 31, 2023? Select one: a. $24,500 b. $21,000 c. $ 25,200 d. $30, 240 e. $19,600
Truffle Inc. acquired a patent on January 1, 2015 for $7,800,000. It was expected to have a 10 year life and no residual value. Truffle uses straight-line amortization for its patents. On December 31, 2018, the expected future cash flows from the patent are $518,000 per year for the next six years. The present value of these cash flows, discounted at Truffle’s market interest rate, is $2,120,000. What amount, if any, of impairment loss will be reported on Truffle’s 2018 income statement?
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
A company buys an oil rig for P1,200,000 on January 1, 2020. The life of the rig is 12 years and the expected cost to dismantle the rig at the end of 12 years is P300,000 (present value factor of 1, 12% for 12 years is 0.2567). 12% is an appropriate interest rate for this company. What is the total expense should be recorded for 2020 as a result of these events?
Crane Company acquired a patent on an oil extraction technique on January 1, 2020 for $805000O. It was expected to have a 10 year life and no residual value. Crane uses straight-line amortization for patents. On December 31, 2021, the future cash flows expected from the patent were $1065000 per year for the next eight years. The present value of these cash flows, discounted at Crane's market interest rate, is $4475000. At what amount should the patent be carried on the December 31, 2021 balance sheet? O $8050000. O $6440000. O $8520000. O $4475000.

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