Question

Bethany incurred $34,000 in research experimental cost for developing a specialized product during July of Year 1. Bethany went through a lot of trouble and spent $13,000 in legal fees to receive a patent for the product in August of Year 3. Bethany expects the patent to have a remaining useful life of 10 years. Round your final answer to the nearest whole dollar.

If Bethany chose to capitalize but not amortize the research and experimental expenses she incurred in year 1, how much patent amortization expense would Bethany deduct in year 3?

Answer 1

Ans- Particulars Amount (in $) Req8eqych experimental cost CA) = 34000 Legal Fees to receive patent (B) = 13000 Amortizable expenses CA+B)- 47000 Period of Amortization = 10 years period of Amortization in months = 120 (12X10 ) (C) Monthly Amortization on Straight, 20 line Basis = 391•67 CLA+B) + ( ) Total months from August to December - 5 year 3 Amortization for Patent 1988.35 (391.67 XS) or Rounded off & 1958