Chapter 9, Problem 9.12BE

(a)

To determine

Patent: Patent is a right that is exclusively granted by the Government to an individual or firm to process or design, to make, use or sell its invention for a limited period. It protects the right of the inventor from doing so by any other individual till the granted period expires.

Amortization: It is the process of allocating the value of patent over its estimated useful life.

To record: the journal entry for the amortization expense for the first year

(b)

To determine

To show: the reporting of patent on the balance sheet at the end of the first year.