XYZ Corporation incurred the following costs in 2020: • XYZ Corporation purchased a patent from ABC Company for $12,000,000 on March 1, 2020. The estimated remaining useful life of the patent is 8 years. • XYZ Corporation incurred the following research and development costs related to its trademark. Personnel Materials Supplies $30,000 10,000 5,000 C. XYZ Corporation purchased a franchise from DEF Company for $1,000,000 on August 1, 2020. The contract of the franchise is for 10 years. Instructions: A. Calculate the amortization for 2020. B. Calculate the total expenses reported on the Income Statement for the year ended December 31, 2020. C. Determine the total intangible assets of XYZ Corporation to be reported on the Balance Sheet at December 31, 2020.
XYZ Corporation incurred the following costs in 2020: • XYZ Corporation purchased a patent from ABC Company for $12,000,000 on March 1, 2020. The estimated remaining useful life of the patent is 8 years. • XYZ Corporation incurred the following research and development costs related to its trademark. Personnel Materials Supplies $30,000 10,000 5,000 C. XYZ Corporation purchased a franchise from DEF Company for $1,000,000 on August 1, 2020. The contract of the franchise is for 10 years. Instructions: A. Calculate the amortization for 2020. B. Calculate the total expenses reported on the Income Statement for the year ended December 31, 2020. C. Determine the total intangible assets of XYZ Corporation to be reported on the Balance Sheet at December 31, 2020.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Please answer required a,b,c
Transcribed Image Text:Part Seven: Problem
XYZ Corporation incurred the following costs in 2020:
• XYZ Corporation purchased a patent from ABC Company for $12,000,000 on March 1, 2020. The estimated
remaining useful life of the patent is 8 years.
• XYZ Corporation incurred the following research and development costs related to its trademark.
Personnel
Materials
Supplies
$30,000
10,000
5,000
C. XYZ Corporation purchased a franchise from DEF Company for $1,000,000 on August 1, 2020. The contract of
the franchise is for 10 years.
Instructions:
A. Calculate the amortization for 2020.
B. Calculate the total expenses reported on the Income Statement for the year ended December 31, 2020.
C. Determine the total intangible assets of XYZ Corporation to be reported on the Balance Sheet at December 31,
2020,
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