On January 2, 1998, the Jackson Corporation acquired patent rights from the Cooper Company for $85,000, incurring legal costs of $5,000. Although the patent will not expire for 17 years, its estimated useful is only 15 years. Journalize the entry to amortize the patent at the end of the current fiscal year.
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On January 2, 1998, the Jackson Corporation acquired patent rights from the Cooper
Company for $85,000, incurring legal costs of $5,000. Although the patent will not
expire for 17 years, its estimated useful is only 15 years.
amortize the patent at the end of the current fiscal year.
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- On September 1, 2019, Jordan, Inc. acquired a patent for $600,000. The patent has 16 years remaining in its legal life. However, Jordan, Inc. expects the patent's technology to have a useful life of 8 years. Prepare the journal entries to record the acquisition of the patent and the amortization expense for 2019. Date Account Debit CreditBlue Co. purchased a patent from the inventor for $36,000 on March 1, 20X6. Blue Co.’s fiscal year-end is December 31 each year. On the March 1, 20X6 purchase date, the remaining legal life of the patent was 6 years based on the original legal life of 20 years less 14 years since the patent was registered. Also on the March 1, 20X6 purchase date, the estimated remaining useful life of the patent for Blue Co.’s purposes is 3 years. Blue Co. amortizes patent costs in the year of acquisition for the portion of the year the patent was held. What is the patent’s book or carrying value as of December 31, 20X7? a. $14,000 b. $12,000 c. $22,000 d. $10,000Bleach Manufacturing purchased a patent from Blond Inc. for $30,000 on January 1, 2023. The patent has 6 years remaining on its term and is expected to bring in revenues to the company for the whole six years. The entry to record one year's amortization for the year ending December 31, 2023, is: Select one: a. Debit Accumulated Amortization-Patents $30,000; credit Amortization Expense-Patents $30,000 b. Debit Accumulated Amortization-Patents $5,000; credit Amortization Expense-Patents $5,000 O c. Debit Amortization Expense-Patents $5,000; credit Accumulated Amortization-Patents $5,000 O d. Debit Amortization Expense-Patents $30,000; credit Accumulated Amortization-Patents $30,000
- On January 1, Year 1, Stiller Company paid $192,000 to obtain a patent. Stiller expected to use the patent for 5 years before it became technologically obsolete. The remaining legal life of the patent was 8 years. Based on this information, what is the amount of amortization expense during Year 3 and the book value of the patent as of December 31, Year 3, respectively? Multiple Choice O $24,000 and $72,000 $24,000 and $120.000 $38,400 and $76,800 $38,400 and $115,200On January 1, 2022, Scarlet registered a patent for a total registration and legal cost of P800,000. Scarlet estimates that the patent has a remaining useful life of 25 years. How much will be the carrying amount of the patent in December 31, 2024?On January 2, 2021, Concord Company purchased a patent for $390,000. The patent has an 6-year estimated useful life and a legal life of 20 years.Prepare the journal entry to record patent amortization. (Credit account titles are automaticallyindented when the amount is entered. Do not indent manually. List all debit entries before credit entries
- 5. On January 1, Purple Manufacturing paid $26,700 for a patent. Although it gives legal protection for 20 years, the patent is expected to provide a competitive advantage for only three years. Assuming the straight-line method of amortization, record the journal entry for amortization for Year 1. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Date Dec. 31 Amortization Expense-Patent Patent Accounts and Explanation To record amortization of patent Debit 8,900 Credit 8,900During 2022, Brownie Company incurred research and development cost of P272,000 relating to the patent that was granted on July 1, 2022. Cost of registering the patent is P68,000. The patent legal life is 20 years. However, the management expected that the patent will be useful for 10 years only. On December 31, 2022, what amount should be reported as patent, net of accumulated amortization?On April 1, 2020, the Tech Corp. acquired a patent for $162,000. This patent has an estimated useful life of 12 years with an estimated residual value of $18,000. Required: a. In determining the 12-year useful life of this patent, what two lives of the patent did Tech consider? b. Which of these two lives did Tech use as the patent's useful life or is that determinable? c. Make the December 31, 2020, entry for Tech to record the 2020 amortization of this patent in the manner that Tech would have to use in this class. d. What will be the book value of this patent on the December 31, 2023, balance sheet? 14 010 120m 20 1
- 16. Logan Corporation purchased a patent for $60,000 on 1-1-2023. The patent has a 5 year remaining life. Required: Record the first year's amortization in the journal.On January 2, 2024, David Corporation purchased a patent for $510,000. The remaining legal life is 10 years, but the company estimated that the patent will be useful only for six years. In January 2026, the company incurred legal fees of $60,000 in successfully defending a patent infringement suit. The successful defense did not change the company's estimate of useful life. Required: Prepare journal entries related to the patent for 2024, 2025, and 2026. Note: 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 Date January 02, 2024 3 Record the purchase of the patent. Note: Enter debits before credits. Record entry 4 5 General Journal Clear entry Debit Credit View general JournalPina Colada Corporation purchased a patent from MaFee Corp. on January 1, 2023, for $85,950. The patent had a remaining legal life of 15 years. In January 2025, Pina Colada spends $27,920 successfully defending a patent suit. In addition, Pina Colada now feels the patent will be useful only for another seven years. Prepare the journal entries to record the 2025 expenditure and amortization for the year. (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. Round answers to O decimal places, e.g. 5,275. List all debit entries before credit entries.)