During 2016, Sarasota Corporation spent $164,160 in research and development costs. As a result, a new product called the New Age Piano was patented. The patent was obtained on October 1, 2016, and had a legal life of 20 years and a useful life of 10 years. Legal costs of $36,720 related to the patent were incurred as of October 1, 2016.
(a)
Prepare all journal entries required in 2016 and 2017 as a result of the transactions above.
Journal entries | |||
DATE | ACCOUNT TITLES AND EXPLANATIONS | DEBIT ($) | CREDIT ($) |
2016 | Research and development expense | 164,160.00 | |
Cash | 164,160.00 | ||
(To Record Research and development expense) | |||
Patents | 36,720.00 | ||
Cash | 36,720.00 | ||
(To record patent) | |||
Patent amortization expense [(36,720/10)*3/12] | 918.00 | ||
Patents | 918.00 | ||
(To record amortization of patent) | |||
2017 | Patent amortization expense | 3,672.00 | |
Patents | 3,672.00 | ||
(To Record Patent Amortization) | |||
During 2016, Sarasota Corporation spent $164,160 in research and development costs. As a result, a new...
During 2016, Sarasota Corporation spent $164,160 in research and development costs. As a result, a new product called the New Age Piano was patented. The patent was obtained on October 1, 2016, and had a legal life of 20 years and a useful life of 10 years. Legal costs of $36,720 related to the patent were incurred as of October 1, 2016. On June 1, 2018, Sarasota spent $9,720 to successfully prosecute a patent infringement suit. As a result, the...
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During 2016, Grouper Corporation spent $152,640 in research and development costs. As a result, a new product called the New Age Piano was patented. The patent was obtained on October 1, 2016, and had a legal life of 20 years and a useful life of 10 years. Legal costs of $28,080 related to the patent were incurred as of October 1, 2016. Prepare all journal entries required in 2016 and 2017 as a result of the transactions above. (Credit account...
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