(a)
Introduction:
An understanding for exchanging responsibility for from a dealer to a purchaser. This Standard Document is drafted to be utilized as an independent contract. It incorporates as a show a short-structure task that can be executed and recorded with the US Copyright Office against booked copyright enlistments and applications.
To choose:
Prepare a
(b)
Introduction:
An understanding for exchanging responsibility for from a dealer to a purchaser. This Standard Document is drafted to be utilized as an independent contract. It incorporates as a show a short-structure task that can be executed and recorded with the US Copyright Office against booked copyright enlistments and applications.
To choose:
Compute record the Amortization expense for the copyright in 2020.
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Cornerstones of Financial Accounting
- The intangible assets section of Novak Corporation's balance sheet at December 31, 2025, is presented here. Patents ($78,000 cost less $7,800 amortization) Copyrights ($46,800 cost less $32,760 amortization) Total $70,200 14,040 $84,240 The patent was acquired in January 2025 and has a useful life of 10 years. The copyright was acquired in January 2019 and also has a useful life of 10 years. The following cash transactions may have affected intangible assets during 2026. Jan. 2 Jan.-June Sept. 1 Oct. 1 Paid $60,840 legal costs to successfully defend the patent against infringement by another company. Developed a new product, incurring $299,000 in research and development costs. A patent was granted for the product on July 1, and its useful life is equal to its legal life. Legal and other costs for the patent were $26,400. Paid $52,000 to a quarterback to appear in commercials advertising the company's products. The commercials will air in September and October. Acquired a copyright for…arrow_forwardDiscuss the appropriate accounting treatment for the following intangible assets on 30 June2022. No entries required. a)Apublishing company purchased the magazine title"Potato Farmer" in 2019 for $2.5 million. An additional $200.000 was spent in 2020 to market the publishing title.On 30 June 2022 the publishing company believes the publishing title can be sold for $20 million. b) A company purchased the music rights to all the works of the famous band The lnsects in2018 for $15,000,000.The rights provided the company with the ability to use the music rights forever. On 30 June 2022 following a scandal involving one of the band members the frm estimates the likely fair value of the music rights is $5,000,000. c) On 30 June 2022 a hair loss treatment company acquired the results of research conducted into possible cures for male baldness from the Western Southern University for $6,000,000. The company intends to progress the most promising parts of the research in 2023 with additional…arrow_forwardanswer needed ASAP Presented below is information related to copyrights owned by Wamser Corporation at December 31, 2020. Cost $6,000,000 Carrying amount 5,200,000 Expected future net cash flows 4,700,000 Fair value 3,200,000 Assume Wamser will continue to use this asset in the future. As of December 31, 2020, the copyrights have a remaining useful life of 5 years. a. Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2020. b. Prepare the journal entry to record amortization expense for 2021. c. The fair value of the copyright at December 31, 2021 is $2,500,000. Prepare the journal entry (if any) necessary to record this increase in fair value.arrow_forward
- The intangible assets section of Pina Corporation’s balance sheet at December 31, 2022, is presented here. Patents ($73,300 cost less $6,900 amortization) $66,400 Copyrights ($57,000 cost less $46,700 amortization) 10,300 Total $76,700 The patent was acquired in January 2022 and has a useful life of 10 years. The copyright was acquired in January 2016 and also has a useful life of 10 years. The following cash transactions may have affected intangible assets during 2023. Jan. 2 Paid $54,000 legal costs to successfully defend the patent against infringement by another company. Jan.– June Developed a new product, incurring $241,500 in research and development costs. A patent was granted for the product on July 1, and its useful life is equal to its legal life. Legal and other costs for the patent were $20,000. Sept. 1 Paid $68,000 to a quarterback to appear in commercials advertising the company’s products. The commercials will air in September and…arrow_forward2. Center Company acquired three intangible assets before 2020. The entity is preparing financial statements on December 31, 2020. Before that date, no formal financial statements had been prepared and the cost of intangible assets had been charged to operations when acquired. The following intangible assets were accounted for in this manner. Acquisition date January 1, 2016 July 1, 2017 January 1, 2018 Useful life Cost Copyright 1 Copyright 2 400,000 360,000 500,000 20 15 Patent 10 Required: Compute the total carrying amount of Intangible asset on December 31,2020. 3. At the beginning of current year, Outlandish Company entered into a franchise agreement with Jollibee Company to sell - Jollibee products for an indefinite period. The agreement provides for an initial fee of P20,000,000, P5,000,000 down upon signing of the contract and the balance in four equal annual payments every year-end. The entity signed 10% interest-bearing note for the balance. The collection of the note is…arrow_forwardRequired information [The following information applies to the questions displayed below.] Hero Sandwich Shop had the following long-term asset balances as of January 1, 2024: Land Building Equipment Patent Cost $86,000 451,000 227,900 205,000 Accumulated Depreciation Book Value $86,000 288,640 179,700 123,000 • Hero purchased all the assets at the beginning of 2022. • The building is depreciated over a 10-year service life using the double-declining-balance method and estimating no residual Land Building Equipment Patent 0 value. • The equipment is depreciated over a 9-year service life using the straight-line method with an estimated residual value of $11,000. HERO SANDWICH SHOP December 31, 2024 $(162,360) (48,200) (82,000) • The patent is estimated to have a five-year useful life with no residual value and is amortized using the straight-line method. • Depreciation and amortization have been recorded for 2022 and 2023 (first two years). 3. Calculate the book value for each of the…arrow_forward
- Determining Carrying Value and Amortization of Intangible Assets Review the following information pertaining to Denzel Company. A patent was purchased on January 2, 2018, for $149,500 when the remaining legal life was 16 years. On January 2, 2020, Denzel determined that the remaining useful life of the patent was only eight years from the date of its acquisition. On January 1, 2020, Denzel Company purchased a second patent for $184,000 cash. At January 1, 2020, 6 years of the patent's legal life of 20 years had already expired. On June 30, 2020, Denzel Company paid a firm $18,400 for a new trademark. Denzel considers the life of the trademark to be indefinite. On November 1, 2020, Denzel Company acquired all noncash assets and assumed all liabilities of Lee Company at a cash purchase price of $276,000. Denzel determined that the fair value of the identfiable net assets acquired in the transaction is $269,100. Note: When answering the following questions, do not round until your…arrow_forwardPresented below is information related to copyrights owned by Taylor Corporation atDecember 31, 2020.Carrying amount 7,000,000Expected future net cash flows 6,200,000Fair value 3,300,000Assume Taylor will continue to use this asset in the future. As of December 31, 2020,the copyrights have a remaining useful life of 5 years.Instructions(a) Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2020.(b) Prepare the journal entry to record amortization expense for 2021.(c) The fair value of the copyright at December 31, 2021 is $3,400,000. Prepare thejournal entry, under GAAP, necessary to record this increase in fair value.arrow_forwardPresented below is information related to copyrights owned by Ivanhoe Corporation at December 31, 2020. Cost $5,640,000 Carrying amount 5,252,000 Expected future net cash flows 5,170,000 Fair value 3,360,000 Assume Ivanhoe will continue to use this asset in the future. As of December 31, 2020, the copyrights have a remaining useful life of 5 years. (a) Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2020. (Credit account titles are automatically indented when the 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 Explanation Debit Credit Dec. 31, 2020arrow_forward
- Conrad Inc. purchased a patent for $1,000,000 for a specialty line of patented switch plate covers and outlet plate covers specifically designed to light up automatically when the power fails. Assume the switch plate patent was purchased January 1, 2020, and it is being depreciated over a period of ten years. Assume that Conrad Inc. does not use an accumulated amortization account but instead charges amortization directly against the intangible asset account. Required: 1. This part of the question is not part of your Connect assignment. 2. Prepare the journal entries to record the purchase and amortization of the switch plate patent in 2020. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 2 Record the purchase of patent. Note: Enter debits before credits. Event a General Journal Debit Credit View general journal Record entry Clear entryarrow_forwardPresented below is information related to copyrights owned by Fielding Company at December 31, 2020. Cost $10,450,000 Carrying amount 6,420,000 Expected future net cash flows 5,000,000 Fair value 3,850,000 Assume that Fielding Company will continue to use this copyright in the future. As of December 31, 2020, the copyright is estimated to have a remaining useful life of 10 years. Instructions Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2020. The company does not use accumulated amortization accounts. Prepare the journal entry to record amortization expense for 2021 related to the The fair value of the copyright at December 31, 2021, is $4,800,000. Prepare the journal entry (if any) necessary to record the increase in fair value.arrow_forwardPresented below is information related to a copyright owned by Music Company at December 31, 2022.Cost of copyright acquired on 1 January 2014 $8,600,000 Recoverable amount at December 31, 2022 3,500,000When the Music Company acquired the copyright in 2014, it estimated the useful life to be 20 years. Assume that Music Company will continue to use this copyright in the future. As of December 31, 2022, the copyright is estimated to have a remaining useful life of 10 years.Required(a) Prepare all the necessary journal entries at December 31, 2023. The company does not use accumulated amortization accounts.(b) The fair value of the copyright at December 31, 2023, is $3,700,000. prepare all the necessary journal entries at December 31, 2022..arrow_forward
- Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning