Homework Answers
| Sheridan Company | |
| Balance Sheet (Partial) | |
| December 31, 2020 | |
| Intangible Assets | |
| Patents | 1260000 |
| Franchise | 477000 |
| Total intangible assets $ | 1737000 |
Working:
| 1 | Purchase cost of patent | 1750000 |
| Less: Amortization for 2019 ($1750000/10) | 175000 | |
| 1575000 | ||
| Less: Amortization for 2020 ($1575000/5) | 315000 | |
| Balance in Patent, Dec. 31, 2020 | 1260000 | |
| 2 | Purchase cost of franchise | 530000 |
| Less: Amortization for 2020 ($530000/10) | 53000 | |
| Balance in Franchise, Dec. 31, 2020 | 477000 |
| Sheridan Company | ||
| Income Statement Effect | ||
| For the Year Ended December 31, 2020 | ||
| Patent from Skysong Company: | ||
| Amortization of patent | 315000 | |
| Franchise from Grouper Company: | ||
| Amortization of franchise | 53000 | |
| Payment to Bramble (5% x $2520000) | 126000 | |
| 179000 | ||
| Research and development costs | 451000 | |
| Total charged against income $ | 945000 | |
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Sheridan Company has provided information on intangible assets as follows. A patent was purchased from Skysong...
Exercise 12-8 Sheridan Company has provided information on intangible assets as follows. A patent was purchased...
Exercise 12-8 Sheridan Company has provided information on intangible assets as follows. A patent was purchased from Ford Company for $2,673,000 on January 1, 2016. Sheridan estimated the remaining useful life of the patent to be 10 years. The patent was carried in Ford’s accounting records at a net book value of $2,046,000 when Ford sold it to Sheridan. During 2017, a franchise was purchased from Polo Company for $567,000. In addition, 5% of revenue from the franchise must be...
Sandhill Company has provided information on intangible assets as follows. A patent was purchased from Teal...
Sandhill Company has provided information on intangible assets as follows. A patent was purchased from Teal Mountain Company for $1,750,000 on January 1, 2019. Sandhill estimated the remaining useful life of the patent to be 10 years. The patent was carried in Teal Mountain's accounting records at a net book value of $1,750,000 when Teal Mountain sold it to Sandhill. During 2020, a franchise was purchased from Monty Company for $450,000. In addition, 5% of revenue from the franchise must...
Pharoah Company has provided information on intangible assets as follows. A patent was purchased from Shamrock...
Pharoah Company has provided information on intangible assets as follows. A patent was purchased from Shamrock Company for $1,600,000 on January 1, 2019. Pharoah estimated the remaining useful life of the patent to be 10 years. The patent was carried in Shamrock's accounting records at a net book value of $1,600,000 when Shamrock sold it to Pharoah. During 2020, a franchise was purchased from Sheffield Company for $490,000. In addition, 5% of revenue from the franchise must be paid to...
Crane Company has provided information on intangible assets as follows. A patent was purchased from Larkspur...
Crane Company has provided information on intangible assets as
follows.
A patent was purchased from Larkspur Company for $1,650,000 on
January 1, 2019. Crane estimated the remaining useful life of the
patent to be 10 years. The patent was carried in Larkspur’s
accounting records at a net book value of $1,650,000 when Larkspur
sold it to Crane.
During 2020, a franchise was purchased from Pronghorn Company for
$480,000. In addition, 5% of revenue from the franchise must be
paid to...
Carla Vista Company has provided information on intangible assets as follows. A patent was purchased from...
Carla Vista Company has provided information on intangible
assets as follows.
A patent was purchased from Tamarisk Company for $1,650,000 on
January 1, 2019. Carla Vista estimated the remaining useful life of
the patent to be 10 years. The patent was carried in Tamarisk’s
accounting records at a net book value of $1,650,000 when Tamarisk
sold it to Carla Vista.
During 2020, a franchise was purchased from Flint Company for
$500,000. In addition, 5% of revenue from the franchise must...
Carla Vista Company has provided information on intangible assets as follows. A patent was purchased from...
Carla Vista Company has provided information on intangible
assets as follows.
A patent was purchased from Tamarisk Company for $1,650,000 on
January 1, 2019. Carla Vista estimated the remaining useful life of
the patent to be 10 years. The patent was carried in Tamarisk’s
accounting records at a net book value of $1,650,000 when Tamarisk
sold it to Carla Vista.
During 2020, a franchise was purchased from Flint Company for
$500,000. In addition, 5% of revenue from the franchise must...
Crane Company has provided information on intangible assets as follows. A patent was purchased from Ford...
Crane Company has provided information on intangible assets as follows. A patent was purchased from Ford Company for $2,330,000 on January 1, 2016. Crane estimated the remaining useful life of the patent to be 10 years. The patent was carried in Ford's accounting records at a net book value of $2,053,000 when Ford sold it to Crane. During 2017, a franchise was purchased from Polo Company for $513,000. In addition, 4% of revenue from the franchise must be paid to...
Exercise 12-8 Sunland Company has provided information on intangible assets as follows. A patent was purchased...
Exercise 12-8
Sunland Company has provided information on intangible assets as
follows.
A patent was purchased from Ford Company for $2,506,000 on January
1, 2016. Sunland estimated the remaining useful life of the patent
to be 10 years. The patent was carried in Ford’s accounting records
at a net book value of $1,968,000 when Ford sold it to
Sunland.
During 2017, a franchise was purchased from Polo Company for
$530,000. In addition, 4% of revenue from the franchise must be...
Cullumber Company has provided information on intangible assets as follows. A patent was purchased from Marin...
Cullumber Company has provided information on intangible assets
as follows.
A patent was purchased from Marin Company for $1,800,000 on January
1, 2019. Cullumber estimated the remaining useful life of the
patent to be 10 years. The patent was carried in Marin’s accounting
records at a net book value of $1,800,000 when Marin sold it to
Cullumber.
During 2020, a franchise was purchased from Bramble Company for
$510,000. In addition, 5% of revenue from the franchise must be
paid to...
Exercise 12-8 Oriole Company has provided information on intangible assets as follows. A patent was purchased...
Exercise 12-8 Oriole Company has provided information on intangible assets as follows. A patent was purchased from Ford Company for $2,624,000 on January 1, 2016. Oriole estimated the remaining useful life of the patent to be 10 years. The patent was carried in Ford’s accounting records at a net book value of $1,976,000 when Ford sold it to Oriole. During 2017, a franchise was purchased from Polo Company for $585,000. In addition, 6% of revenue from the franchise must be...
Sandhill Company has provided information on intangible assets as follows. A patent was purchased from Teal Mountain Company for $1,750,000 on January 1, 2019. Sandhill estimated the remaining useful life of the patent to be 10 years. The patent was carried in Teal Mountain's accounting records at a net book value of $1,750,000 when Teal Mountain sold it to Sandhill. During 2020, a franchise was purchased from Monty Company for $450,000. In addition, 5% of revenue from the franchise must...
Pharoah Company has provided information on intangible assets as follows. A patent was purchased from Shamrock Company for $1,600,000 on January 1, 2019. Pharoah estimated the remaining useful life of the patent to be 10 years. The patent was carried in Shamrock's accounting records at a net book value of $1,600,000 when Shamrock sold it to Pharoah. During 2020, a franchise was purchased from Sheffield Company for $490,000. In addition, 5% of revenue from the franchise must be paid to...
Crane Company has provided information on intangible assets as
follows.
A patent was purchased from Larkspur Company for $1,650,000 on
January 1, 2019. Crane estimated the remaining useful life of the
patent to be 10 years. The patent was carried in Larkspur’s
accounting records at a net book value of $1,650,000 when Larkspur
sold it to Crane.
During 2020, a franchise was purchased from Pronghorn Company for
$480,000. In addition, 5% of revenue from the franchise must be
paid to...
Carla Vista Company has provided information on intangible
assets as follows.
A patent was purchased from Tamarisk Company for $1,650,000 on
January 1, 2019. Carla Vista estimated the remaining useful life of
the patent to be 10 years. The patent was carried in Tamarisk’s
accounting records at a net book value of $1,650,000 when Tamarisk
sold it to Carla Vista.
During 2020, a franchise was purchased from Flint Company for
$500,000. In addition, 5% of revenue from the franchise must...
Carla Vista Company has provided information on intangible
assets as follows.
A patent was purchased from Tamarisk Company for $1,650,000 on
January 1, 2019. Carla Vista estimated the remaining useful life of
the patent to be 10 years. The patent was carried in Tamarisk’s
accounting records at a net book value of $1,650,000 when Tamarisk
sold it to Carla Vista.
During 2020, a franchise was purchased from Flint Company for
$500,000. In addition, 5% of revenue from the franchise must...
Crane Company has provided information on intangible assets as follows. A patent was purchased from Ford Company for $2,330,000 on January 1, 2016. Crane estimated the remaining useful life of the patent to be 10 years. The patent was carried in Ford's accounting records at a net book value of $2,053,000 when Ford sold it to Crane. During 2017, a franchise was purchased from Polo Company for $513,000. In addition, 4% of revenue from the franchise must be paid to...
Exercise 12-8
Sunland Company has provided information on intangible assets as
follows.
A patent was purchased from Ford Company for $2,506,000 on January
1, 2016. Sunland estimated the remaining useful life of the patent
to be 10 years. The patent was carried in Ford’s accounting records
at a net book value of $1,968,000 when Ford sold it to
Sunland.
During 2017, a franchise was purchased from Polo Company for
$530,000. In addition, 4% of revenue from the franchise must be...
Cullumber Company has provided information on intangible assets
as follows.
A patent was purchased from Marin Company for $1,800,000 on January
1, 2019. Cullumber estimated the remaining useful life of the
patent to be 10 years. The patent was carried in Marin’s accounting
records at a net book value of $1,800,000 when Marin sold it to
Cullumber.
During 2020, a franchise was purchased from Bramble Company for
$510,000. In addition, 5% of revenue from the franchise must be
paid to...
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