3
Pina Corporation purchases a patent from Blossom Company on
January 1, 2017, for $59,000. The patent has a remaining legal life
of 16 years. Pina feels the patent will be useful for 10 years.
Assume that at January 1, 2019, the carrying amount of the patent
on Pina’s books is $47,200. In January, Pina spends $24,000
successfully defending a patent suit. Pina still feels the patent
will be useful until the end of 2026.
Prepare the journal entries to record the $24,000 expenditure and
2019 amortization. (Credit account titles are
automatically indented when amount is entered. Do not indent
manually. If no entry is required, select "No Entry" for the
account titles and enter 0 for the
amounts.)
Account Titles and Explanation |
Debit |
Credit |
(To record expenditure of patents) | ||
(To record amortization expense) |
3 Pina Corporation purchases a patent from Blossom Company on January 1, 2017, for $59,000. The...
Brief Exercise 12-2 Flounder Corporation purchases a patent from Pharoah Company on January 1, 2017, for $80,000. The patent has a remaining legal life of 16 years. Flounder feels the patent will be useful for 10 years. Assume that at January 1, 2019, the carrying amount of the patent on Flounder's books is $64,000. In January, Flounder spends $32,800 successfully defending a patent suit. Flounder still feels the patent will be useful until the end of 2026. Prepare the journal...
Brief Exercise 12-2 Your answer is partially correct. Try again Sarasota Corporation purchases a patent from Ivanhoe Company on January 1, 2017 for $72,000. The patent has a remaining legal lide of 16 years. Sarasota feels the patent will be useful for 10 years. Assume that at January 1, 2019, the carrying amount of the patent on Sarasota's books is 557,600. In January, Sarasota spends $32.300 successfully defending patent suit. Sarasota still feels the patient will be useful until the...
Culver Corporation purchases a patent from Sunland Company on January 1, 2020, for $78,000. The patent has a remaining legal life of 16 years. Culver feels the patent will be useful for 10 years. Assume that at January 1, 2022, the carrying amount of the patent on Culver’s books is $62,400. In January, Culver spends $25,600 successfully defending a patent suit. Culver still feels the patent will be useful until the end of 2029. Prepare the journal entries to record...
Novak Corporation purchases a patent from Wildhorse Company on January 1, 2020, for $69,000. The patent has a remaining legal life of 16 years. Novak feels the patent will be useful for 10 years. Assume that at January 1, 2022, the carrying amount of the patent on Novak’s books is $55,200. In January, Novak spends $26,400 successfully defending a patent suit. Novak still feels the patent will be useful until the end of 2029. Prepare the journal entries to record...
Sandhill Corporation purchases a patent from Wildhorse Company on January 1, 2020, for $100,800. The patent has a remaining legal of 16 years. Sandhill feels the patent will be useful for 10 years. Assume that at January 1, 2022, the carrying amount of the patent on Sandhill's books is $80,640. In January, Sandhill spends $24,000 successfully defending a patent suit. Sandhill still feels the patent will be useful until the end of 2029. Prepare Sandhill's journal entries to record the...
Jaina Corporation purchases a patent from Monty Company on January 1, 2020, for $99,120. The patent has a remaining legal of 16 years. Jaina feels the patent will be useful for 10 years. Assume that at January 1, 2022, the carrying amount of the patent on Jaina's books is $79,296. In January, Jaina spends $23,600 successfully defending a patent suit. Jaina still feels the patent will be useful until the end of 2029. Prepare Jaina's journal entries to record the...
Brief Exercise 12-1 Monty Corporation purchases a patent from Sandhill Company on January 1, 2017, for $55,000. The patent has a remaining legal life of 12 years. Monty feels the patent will be useful for 10 years. Prepare Monty’s journal entries to record the purchase of the patent and 2017 amortization. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0...
Brief Exercise 12-1 Pronghorn Corporation purchases a patent from Crane Company on January 1, 2017, for $50,000. The patent has a remaining legal life of 15 years. Pronghorn feels the patent will be useful for 10 years. Prepare Pronghorn's journal entries to record the purchase of the patent and 2017 amortization. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter 0...
Cheyenne Corporation purchases a patent from Oriole Company on January 1, 2020, for $64,000. The patent has a remaining legal life of 16 years. Cheyenne feels the patent will be useful for 10 years. Assume that at January 1, 2022, the carrying amount of the patent on Cheyenne’s books is $51,200. In January, Cheyenne spends $37,600 successfully defending a patent suit. Cheyenne still feels the patent will be useful until the end of 2029.
During 2016, Pina Corporation spent $159,840 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 $32,400 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...