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os 9-19 Intangible assets and amortization LO7 Assume Barrick Gold Corporation purchased mineral rights for a gold mine in Peru on October 1, 2017. by paying cash rick also paid $4,000,000 cash for water rights needed to mine the gold. Barrick is planning to mine this of $5,000,000 and incurring a non-current note payable for the $30,000,000 balance. Bar- area for 10 years. Record the purchase of the mineral rights and water rights on October 1,2017, and the ortization on December 31, 2017, Barricks year-end. Assume Barrick uses the straight-line method to amortize intangibles.

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SolutionFormat and Naming convention is not available can be slightly different, if available with question As perbusiness policy, Amortization of intangible can directly be offset against Rights, instead of Accumulated Amortization account. ournal entries Account title and explaination Debit Credit Oct.01 Mieral Rights - Gold Mine (5000000+30000000) 2017 35000000 Water Rights Cash Note Payable To record the purchase of mineral rights and water rights) 4000000 9000000 Dec.31Amortization Expense 2017 Accumulated Amortization - Mineral rights (35000000/10)/12*3 975000 Accumulated Amortization - Water rights (4000000/10)/12*3 (To record the amortization of intangibles)

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