**Horstmeyer Corporation: Intangible Asset Expenditures Overview**In 2021, Horstmeyer Corporation began operations and recorded various expenditures under an account labeled "intangible asset." The total balance at the end of the year was $252,500. Below is a detailed recap of these expenditures:| Date | Transaction | Amount ||------------|------------------------------------------------------------------------------|----------|| February 3 | State incorporation fees and legal costs related to organizing the corporation | $9,500 || March 1 | Fire insurance premium for a three-year period | $7,500 || March 15 | Purchased a copyright | $40,000 || April 30 | Research and development costs | $60,000 || June 15 | Legal fees for filing a patent on a new product resulting from an R&D project | $7,500 || September 30 | Legal fee for successful defense of patent developed above | $32,000 || October 13 | Entered into a 10-year franchise agreement with franchisor | $60,000 || Various | Advertising costs | $36,000 || **Total** | | **$252,500** |**Required Task:**Prepare the necessary journal entry to clear the intangible asset account. Set up accounts for separate intangible assets and other types of assets, along with expenses according to these transactions. If a transaction or event does not require an entry, select "No journal entry required."**Instructions:**- Use the "View transaction list" option to delve into each transaction as needed.- Utilize the "Journal entry worksheet" for recording entries, especially where indicated by the transactions.**Note:** If an entry is not necessary for a transaction/event, select "No journal entry required" in the first account field.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms.…

The Horstmeyer Corporation commenced operations early in 2021. A number of expenditures were made during 2021 that were debited to one account called intangible asset. A recap of the $252,500 balance in this account at the end of 2021 is as follows: Date Transaction Amount $ 9,500 7,500 State incorporation fees and legal costs related to organizing the corporation Fire insurance premium for three-year period Purchased a copyright Research and development costs Legal fees for filing a patent on a new product resulting from an R&D project February 3 March 1 March 15 40,e00 60, e00 7,500 32,000 60, ee0 36,000 April 30 June 15 September 30 Legal fee for successful defense of patent developed above Entered into a 10-year franchise agreement with franchisor Advertising costs October 13 Various Total $252,500 Required: Prepare the necessary journal entry to clear the intangible asset account and to set up accounts for separate intangible assets, other types of assets, and expenses indicated by the transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

The Horstmeyer Corporation commenced operations early in 2021. A number of expenditures were made during 2021 that were debited to one account called intangible asset. A recap of the $252,500 balance in this account at the end of 2021 is as follows: Date Transaction Amount $ 9,500 7,500 State incorporation fees and legal costs related to organizing the corporation Fire insurance premium for three-year period Purchased a copyright Research and development costs Legal fees for filing a patent on a new product resulting from an R&D project February 3 March 1 March 15 40,e00 60, e00 7,500 32,000 60, ee0 36,000 April 30 June 15 September 30 Legal fee for successful defense of patent developed above Entered into a 10-year franchise agreement with franchisor Advertising costs October 13 Various Total $252,500 Required: Prepare the necessary journal entry to clear the intangible asset account and to set up accounts for separate intangible assets, other types of assets, and expenses indicated by the transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

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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