Long-Term AssetsSavedKreiser Company had three intangible assets at the end of 2020 (end of the accounting year):31a. A patent was purchased from J. Miller on January 1, 2020, for a cash cost of $5,625. When purchased, the patent had an estimatedlife of fifteen years.b. A trademark was registered with the federal government for $21,000, Management estimated that the trademark could be worth asmuch as $200,000 because it has an indefinite life.c. On January 1, 2020, computer licensing rights were purchased for $59,600, The rights are expected to have a four-year useful lifeto the company.DintsRequired:1. Compute the acquisition cost of each intangible asset.еВookAcquisition cost:ReferencesPatentTrademarkLicensing rights2. Compute the amortization of each intangible for the vear ended December 31, 2020.Amortization expensePatentTrademarkLicensing rights3. Show how these assets and any related expenses should be reported on the balance sheet and income statement for 2020.Partial Income Statement for 2020:Partial Balance Sheet at December 31, 2020IntangiblesTotal IntangiblesMc< Prev31 of 32P Type here to search

1). Computation of acquisition cost Acquisition cost Patent $5,625 Trademark $21,000…

Required: 1. Compute the acquisition cost of each intangible asset. Acquisition cost: Patent Trademark Licensing rights 2. Compute the amortization of each intangible for the year ended December 31, 2020. Amortization expense Patent Trademark Licensing rights 3. Show how these assets and any related expenses should be reported on the balance sheet and income statement for 2020 Partial Income Statement for 2020: Partial Balance Sheet at December 31, 2020: Intangibles Total Intangibles

Required: 1. Compute the acquisition cost of each intangible asset. Acquisition cost: Patent Trademark Licensing rights 2. Compute the amortization of each intangible for the year ended December 31, 2020. Amortization expense Patent Trademark Licensing rights 3. Show how these assets and any related expenses should be reported on the balance sheet and income statement for 2020 Partial Income Statement for 2020: Partial Balance Sheet at December 31, 2020: Intangibles Total Intangibles

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

From page 7-1 of the VLN, acquisition cost would NOT include: A. Purchase price. B. Transportation cost to get the asset ready to be used. C. Sales taxes. D. Cost incurred to operate the asset.
The fact that generally accepted accounting principles allow companies flexibility in choosing between certain allocation methods can make it difficult for a financial analyst to compare periodic performance from firm to firm. Suppose you were a financial analyst trying to compare the performance of two companies. Company A uses the double-declining- balance depreciation method. Company B uses the straight-line method. You have the following information taken from the 12/31/2021 year-end financial statements for Company B: Income Statement Depreciation expense $10,000 Balance Sheet Assets: Plant and equipment, at cost Less: Accumulated depreciation Net $ 200,000 (40,000) $ 160,000 You also determine that all of the assets constituting the plant and equipment of Company B were acquired at the same time, and that all of the $200,000 represents depreciable assets. Also, all of the depreciable assets have the same useful life and residual values are zero. Required: 1. In order to compare…
Computing Partial Period Depreciation under Multiple Depreciation Methods Compute depreciation expense for 2021 for each asset #1, #2, #3, and #4. Note: Do not round until your final answer. Round your final answer to the nearest whole dollar. Acquisition Acquisition Useful Salvage 2021 Depreciation Value Asset Date Depreciation Method Cost Life Expense #1 Jan. 1, 2020 Straight-line $4,000 4 years $200 $ 950 v #2 Aug. 30, 2020 Double-declining-balance 5,800 8 years 400 $ 1,125 x #3 Feb. 1, 2021 Sum-of-the-years'-digits 7,200 4 years 320 $ 1,147 x #4 Jul. 31, 2021 Straight-line 13,520 8 years 0 $
Prepare these journal entries: Dec. 31, 2020 (To clear Intangible Assets account)Dec. 31, 2020 (To correct for amortization on franchises)Dec. 31, 2020 (To correct for rent payments)Dec. 31, 2020 (To record amortization expense on patents)Dec. 31, 2020 (To record amortization expense on licences)Dec. 31, 2020 (To record amortization expense on development cost)
PLEASE provide Solutions
Current Attempt in Progress Carla Vista Co., organized in 2024, has set up a single account for all intangible assets. The following summary discloses the debit entries that have been recorded during 2025 and 2026. 7/1/25 10/1/25 12/31/25 1/2/26 3/1/26 4/1/26 6/1/26 9/1/26 Intangible Assets 8-year franchise; expiration date 6/30/33 Advance payment on laboratory space (2-year lease) Net loss for 2025 including state incorporation fee, $3,000, and related legal fees of organizing, $7,000 (all fees incurred in 2025) Patent purchased (10-year life) Cost of developing a secret formula (indefinite life) Goodwill purchased (indefinite life) Legal fee for successful defense of patent purchased above Research and development costs $48,000 25,800 17,800 80,600 82,000 279,600 12,765 165,000 Prepare the necessary entries to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles. Make the entries as of December 31, 2026, recording any necessary…
The following is a statement of earned surplus prepared by the company for 2021: Balance, 1/1 Additions: Change in estimate of 2021 amortization expense Gain on sale of land Interest income Profit for 2021 Total 000 P 85,949 sediba P 2,800 18,350 4,500 13,680 39,330 125,279 Deductions: Increased depreciation due to change in estimated life O Dividends declared and paid Loss on sale of equipment Loss from major casualty Balance, 12/31 P 5,000 10,000 3,860 27,730 46,590 P 78,689 The adjusted profit or loss that should be reported in the company's income statement for the year ended Dec. 31, 2021 is a. P7,260 loss b. P5,060 loss c. P4,940 profit d. P2,740 profit
Intangibles: Balance Sheet Presentation and Income Statement Effects Clinton Company has provided information on Intangible assets as follows: 1. A patent was purchased from Lou Company for $1,230,000 on January 1, 2018. Clinton estimated the remaining useful life of the patent to be 15 years. The patent was carried in Lou's accounting records at a net book value of 5850,000 when Lou sold it to Clinton. 2. During 2019, a franchise was purchased from Rink Company for $550,000, In addition, 6% of revenue from the franchise must be pald to Rink. Revenue from the franchise for 2019 was $2,500,000. Clinton estimates the useful life of the franchise to be 5 years and takes a full vear's amortization in the year of purchase. 3. Clinton incurred RAD costs in 2019 as follows: Materials and equipment $147,000 Personnel 178,000 Indirect costs 69,000 $394,000 Clinton estimates that these costs will be recouped by December 31, 2020. 4. On January 1, 2019, Clinton estimates, based on new events,…
Provide the 2020 adjusting journal entry (both accounts and amounts) that Newell Brands made to record amortization on its finite-lived Intangible Assets. Assume that Newell Brands makes one adjusting journal entry for amortization expense at the end of each fiscal year as part of its adjusting entries
Presented below is information related to copyrights owned by Carla Vista Company at December 31, 2020. Cost $8,630,000 Carrying amount 4,480,000 Expected future net cash flows 4,140,000 Fair value 3,330,000 Assume that Carla Vista Company will continue to use this copyright in the future. As of December 31, 2020, the copyright is estimated to have a remaining useful life of 10 years. Prepare the journal entry to record amortization expense for 2021 related to the copyrights.