Skysong Industries has the following patents on its December 31, 2019, balance sheet. Patent Item Initial Cost Date Acquired Useful Life at Date Acquired Patent A $42,024 3/1/16 17 years Patent B $15,720 7/1/17 10 years Patent C $17,280 9/1/18 4 years The following events occurred during the year ended December 31, 2020. 1. Research and development costs of $236,000 were incurred during the year. 2. Patent D was purchased on July 1 for $47,310. This patent has a useful life of 9/2 years. 3. As a result of reduced demands for certain products protected by Patent B, a possible impairment of Patent B's value may have occurred at December 31, 2020. The controller for Skysong estimates the expected future cash flows from Patent B will be as follows. Year Expected Future Cash Flows 2021 $2,100 2022 2,100 2023 2,100 (b) Compute the total carrying amount of Skysong' patents on its December 31, 2020, balance sheet. Total carrying amount

Skysong Industries has the following patents on its December 31, 2019, balance sheet. Patent Item Initial Cost Date Acquired Useful Life at Date Acquired Patent A $42,024 3/1/16 17 years Patent B $15,720 7/1/17 10 years Patent C $17,280 9/1/18 4 years The following events occurred during the year ended December 31, 2020. 1. Research and development costs of $236,000 were incurred during the year. 2. Patent D was purchased on July 1 for $47,310. This patent has a useful life of 9/2 years. 3. As a result of reduced demands for certain products protected by Patent B, a possible impairment of Patent B's value may have occurred at December 31, 2020. The controller for Skysong estimates the expected future cash flows from Patent B will be as follows. Year Expected Future Cash Flows 2021 $2,100 2022 2,100 2023 2,100 (b) Compute the total carrying amount of Skysong' patents on its December 31, 2020, balance sheet. Total carrying amount

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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