Question

14 a. A patent purchased this year from Miller Co. on January 1 for a cash cost of $9,300. When purchased, the patent had an estimated life of 15 years. b.A trademark was registered with the federal government for $10,000. Management estimated that the trademark could be worth as much as $200,000 because it has an indefinite life c. Computer licensing rights were purchased this year on January 1 for $60,000. The rights are expected to have a five-year useful life to the company 0.49 points Required: 1. Compute the acquisition cost of each intangible asset. 2. Compute the amortization of each intangible for the current year ended December 31. 3. Show how these assets and any related expenses should be reported on the balance sheet and income statement for the current year Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Reg ЗА Req 3B Req 1 Req 2 Compute the amortization of each intangible for the current year ended December 31. (Do not round intermediate calculations.) Amortization Expenses Patent 620 $ 0 Trademark Licensing Rights 1,000 x $

Answer 1

Particulars	Acquisition Cost	Life	Amotisation Expense	Calculation
Patent	9,300	15	620	*9300/15
Trademark	10,000	indefinite	-	no amortisation because of indefinite life
License	60,000	5	12,000	*60000/5
Total			12,620
Blueston Company
Income Statement (partial)
For the year ended December 31st
Amortisation Expense	12,620
Blueston Company
Balance Sheet (partial)2
For the year ended December 31st
Intangible Assets
Patent	9,300
Trademark	10,000
License	60,000
Amortisation Expense	(12,620)
	66,680