te downward to 5 remaining years. Ar e 30. The company's year ends Dece 150 000 60 000
te downward to 5 remaining years. Ar e 30. The company's year ends Dece 150 000 60 000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Please select the answer from the given amount
Transcribed Image Text:te downward to 5 remaining years. Ar
e 30. The company's year ends Dece
150 000
60 000
Expert Solution
Requirement 1:
Cost of patent purchased in Jan 2004 = $59500
Useful life of patent = 17 years
Amortisation amount = Cost of patent purchased / Useful life
= 59500/17 = $3500
Carrying value of patent as on December 31, 2004 = Original cost of patent - Amortisation amount
= 59500 - 3500 = $56000.
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