The Western Company, a company that follows IFRS, provided you with the following information about a number of transactions that took place in 2020: On January 1, 2020 Western acquired a patent for $45,000 cash. The patent expires on January 1, 2028, but the company determined that it will generate future benefits for 6 years from the date of acquisition. During 2022, the total useful life of the patent was revised to 4 years. During March 2020, The Wester Company invested $120,000 in research costs about a new product that it aims to develop in 2021. The amount was paid in cash. The Western Company estimates that its internal goodwill is worth $980,000 in July 2020. Required- Prepare the journal entries related to the patent from January 1, 2020 to December 31, 2022. Prepare the journal entries for 2 and 3. If no journal entry is required, justify why.

The Western Company, a company that follows IFRS, provided you with the following information about a number of transactions that took place in 2020: On January 1, 2020 Western acquired a patent for $45,000 cash. The patent expires on January 1, 2028, but the company determined that it will generate future benefits for 6 years from the date of acquisition. During 2022, the total useful life of the patent was revised to 4 years. During March 2020, The Wester Company invested $120,000 in research costs about a new product that it aims to develop in 2021. The amount was paid in cash. The Western Company estimates that its internal goodwill is worth $980,000 in July 2020. Required- Prepare the journal entries related to the patent from January 1, 2020 to December 31, 2022. Prepare the journal entries for 2 and 3. If no journal entry is required, justify why.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter12: Intangibles

Section: Chapter Questions

Problem 8P

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