Presented below is information related to copyrights owned by Carla Vista Company at December 31, 2020. Cost   $8,630,000 Carrying amount   4,480,000 Expected future net cash flows   4,140,000 Fair value   3,330,000 Assume that Carla Vista 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. The fair value of the copyright at December 31, 2021, is $3,500,000. Prepare the journal entry necessary to record the increase in fair value.

1. Pharoah purchased a patent from Vania Co. for $2,700,000 on January 1, 2018. The patent is being amortized over its remaining legal life of 10 years, expiring on January 1, 2028. During 2020, Pharoah determined that the economic benefits of the patent would not last longer than 7 years from the date of acquisition. What amount should be reported in the balance sheet for the patent, net of accumulated amortization, at December 31, 2020? The amount to be reported 2$ 2. Pharoah bought a franchise from Alexander Co. on January 1, 2019, for $979,000. The carrying amount of the franchise on Alexander's books on January 1, 2019, was $635,000. The franchise agreement had an estimated useful life of 20 years. Because Pharoah must enter a competitive bidding at the end of 2028, it is unlikely that the franchise will be retained beyond 2028. What amount should be amortized for the year ended December 31, 2020? The amount to be amortized 3. On January 1, 2020, Pharoah incurred organization…

Presented below is information related to copyrights owned by Carla Vista Company at December 31, 2020. Cost   $8,630,000 Carrying amount   4,480,000 Expected future net cash flows   4,140,000 Fair value   3,330,000 Assume that Carla Vista 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. Prepare the journal entry to record amortization expense for 2021 related to the copyrights.