a. Explanation Goodwill : The value of an intangible asset is determined by the factors like quality, management, capacity to generate income and reputation with the general public and other competitive firms is known as the goodwill for the firm Amortization: When the costs of intangibles are allocated over a certain period in a systematic manner it is known as amortization of intangible assets. Research and Development Expenditure: Expenditures incurred for the purpose of research or generation of new technology, products or service is known as research and development expenditure 1. Journal entry to record the payment made for the Research and development expense. Date Account title and explanation Post. Ref. Debit ($) Credit ($) January 1 R&D expense 712,000 Cash 712,000 (to record the payment of the R&D expense) Table (1) R&D expense is the expense for the company. Since, it reduces the profit of the company. Hence, R&D expense account is debited. Cash is the asset account. Since, cash has been paid due to which equity of the reduced. Hence, cash account is credited. 2. Journal entry to record the addition cost of the research and development. Date Account title and explanation Post. Ref. Debit ($) Credit ($) January 1 R&D expense 200,000 Patent 13,800 Cash 213,800 (To record the payment of the R&D expense) Table (2) R&D expense is the expense for the company. Since, it reduces the profit of the company. Hence, R&D expense account is debited. Patent is the assets for the company. Since, Patent has been obtained due to which asset of the increase. Hence, Patent account is debited. Cash is the asset account. Since, cash has been paid due to which equity of the reduced. Hence, cash account is credited. 3. Journal entry to record the advance payment. Date Account title and explanation Post... b. To determine To prepare: The journal entry of the each transaction c. To determine The effect of transaction on the income statement, balance sheet and cash flow statement.

3rd Edition

ISBN: 9780136912644

Author: Elizabeth A. Gordon; Jana S. Raedy; Alexander J. Sannella

Publisher: Pearson Education (US)

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Chapter 11, Problem 11.10P

To determine

To prepare: The journal entry of the each transaction.

To determine

To prepare: The journal entry of the each transaction

To determine

The effect of transaction on the income statement, balance sheet and cash flow statement.

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Chapter 11, Problem 11.9P

Chapter 11, Problem 11.11P

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Chapter 11 Solutions

Intermediate Accounting

Ch. 11 - Stephen J. Cosgrove is the Former Vice President....Ch. 11 - Prob. 11.2Q Ch. 11 - Prob. 11.3Q Ch. 11 - Prob. 11.4Q Ch. 11 - Will the expense/capitalization choice impact...Ch. 11 - Prob. 11.6Q Ch. 11 - Prob. 11.7Q Ch. 11 - For a long-lived operating asset acquired by...Ch. 11 - Prob. 11.9Q Ch. 11 - Prob. 11.10Q

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The journal entry of the each transaction.

Solution Summary: The author explains that the value of an intangible asset is determined by the factors like quality, management, capacity to generate income and reputation with the general public and other competitive firms.

To prepare: The journal entry of the each transaction.

To prepare: The journal entry of the each transaction

The effect of transaction on the income statement, balance sheet and cash flow statement.

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Chapter 11 Solutions