The following are selected 2022 transactions of Tamarisk Corporation.Jan. 1Purchased a small company and recorded goodwill of $225,000. Its useful life is indefinite.April 1Purchased for $136,000 a patent with an estimated useful life of 5 years and a legal life of 20 years.(a)Your answer is partially correct.Prepare necessary adjusting entries at December 31 to record amortization required by the events above. (Credit account titles areautomatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries. If no entry isrequired, select "No Entry" for the account titles and enter O for the amounts.)DateAccount Titles and ExplanationDec. 31Amortization ExpensePatents(To record amortization expense for patents)Dec. 31GoodwillPatentsDebit20400340600Credit20400340600

The objective of the question is to prepare the necessary adjusting entries at December 31 to record…

Answered: The following are selected 2022…

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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On January 2, 2021, Teal Mountain Company purchased a patent for $47,800. The patent has an estimated useful life of 25 years and a 20-year legal life.What entry would the company make at December 31, 2021 to record amortization expense on the patent? (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Blue Corporation's adjusted trial balance contained the following asset accounts at December 31, 2020: Prepaid Rent $14,600, Goodwill $54,400, Franchise Fees Receivable $3,900, Franchises $44,800, Patents $30,890, and Trademarks $12,010. Prepare the intangible assets section of the balance sheet.
A. Manam Co purchased a Trademark for $ 160,000 on October 1, 2020. The Trademark is legally used for 10-year period. Required: Prepare the journal entry to record the amortization expense on Dec 31, 2020
Whispering Company owns equipment that cost $100,000 when purchased on January 1, 2019. It has been depreciated using the straight-line method based on an estimated salvage value of $10,000 and an estimated useful life of 5 years. Depreciation expense adjustments are recognized annually. Instructions: Prepare Whispering Company's journal entries to record the sale of the equipment in these four independent situations. Update depreciation on assets disposed of at time of sale. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) (a) (b) (c) (d) (e) (f) (a) Sold for $59,000 on January 1, 2022. Sold for $59,000 on April 1, 2022. SR. Account Titles and Explanation (b) Sold for $21,000 on January 1, 2022. Sold for $21,000 on September 1, 2022. Repeat (a), assuming Whispering uses double-declining…
On October 12, 2023, Simarov, Inc. purchases a Copyright to a song, written by a person who died on October 12, 1963 for $50,000 cash. Simarov believes they will be able to generate revenue from the Copyright for the remaining useful life. Prepare the journal entry to record the purchase. DR: CR: What is the remaining useful life of the Copyright? How much amortization expense will Simarov record each year? years Prepare the adjusting journal entry to record one year's amortization. DR: CR: What is the Net Book Value of the Copyright on October 1, 2027?
On December 31, 2020, Riverbed Inc. has a machine with a book value of $1,410,000. The original cost and related accumulated depreciation at this date are as follows. Machine $1,950,000 Less: Accumulated depreciation 540,000 Book value $1,410,000 Depreciation is computed at $90,000 per year on a straight-line basis. Presented below is a set of independent situations. For each independent situation, indicate the journal entry to be made to record the transaction. Make sure that depreciation entries are made to update the book value of the machine prior to its disposal. (a) Your answer is correct. A fire completely destroys the machine on August 31, 2021. An insurance settlement of $645,000 was received for this casualty. Assume the settlement was received immediately. (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.) Date Account Titles and…
please answer all parts within 30 minutes...
The Laura Company has the following errors on its books as of December 31, 2020. The books for 2020 have not yet been closed. a. In 2020, fully depreciated equipment (with no residual value) that originally cost $8,000 was sold for $700 as scrap. The company credited the $700 proceeds to Equipment. b. On January 1, 2019, the company recorded the purchase of equipment in exchange for a three-year, noninterest-bearing note payable in the amount of $10,000. Interest rates were then 8%, but no recognition was made of this fact. The present value of $1 at 8% for three periods is 0.7938. (Ignore depreciation.) Required: Prepare journal entries to correct these errors at December 31, 2020. Ignore income taxes.
(Accounting for Trade Name) In early January 2016, Outkast Corporation applied for a trade name, incurring legal costs of $16,000. In January 2017, Outkast incurred $7,800 of legal fees in a successful defense of its trade name.Instructions(a) Compute 2016 amortization, 12/31/16 book value, 2017 amortization, and 12/31/17 book value if the company amortizes the trade name over 10 years.(b) Compute the 2017 amortization and the 12/31/17 book value, assuming that at the beginning of 2017, Outkast determines that the trade name will provide no future benefits beyond December 31, 2020.(c) Ignoring the response for part (b), compute the 2018 amortization and the 12/31/18 book value, assuming that at the beginning of 2018, based on new market research, Outkast determines that the fair value of the trade name is $15,000. Estimated total future cash flows from the trade name is $16,000 on January 3, 2018.
In early January 2024, Ayayai Corporation applied for a trade name, incurring legal costs of $15,800. In January 2025, Ayayai incurred $7,200 of legal fees in a successful defense of its trade name. (a) Compute 2024 amortization, 12/31/24 book value, 2025 amortization, and 12/31/25 book value if the company amortizes the trade name over 10 years. (Round answers to O decimal places, e.g. 5,125.) 2024 amortization 12/31/24 book value 2025 amortization 12/31/25 book value $ LA LA $ of SUPPORT
Rivendell Corporation uses the accrual method of accounting and has the following assets as of the end of 2020. Rivendell converted to an S corporation on January 1, 2021. (Leave no answer blank. Enter zero if applicable.)Asset Adjusted Basis FMVCash $ 40,000 $ 40,000Accounts receivable 30,000 30,000Inventory 130,000 60,000Land 100,000 125,000Totals $ 300,000 $ 255,000 b. Assuming the land was valued at $200,000, what would be Rivendell’s net unrealized gain at the time it converted to an S corporation? c. Assuming the land was valued at $125,000 but that the inventory was valued at $85,000, what would be Rivendell’s net unrealized gain at the time it converted to an S corporation?
Marigold Company purchases a patent for $504,000 on January 2, 2022. Its estimated useful life is 18 years. Prepare the journal entry to record amortization expense for the first year.

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