Marin Golf Inc. was formed on July 1, 2019, when Matt Magilke purchased the Old Master Golf Company. Old Master provides video golf instruction at kiosks in shopping malls. Magilke plans to integrate the instructional business into his golf equipment and accessory stores. Magilke paid $780,000 cash for Old Master. At the time, Old Master’s balance sheet reported assets of $670,000 and liabilities of $200,000 (thus owners’ equity was $470,000). The fair value of Old Master’s assets is estimated to be $830,000. Included in the assets is the Old Master trade name with a fair value of $8,000 and a copyright on some instructional books with a fair value of $38,400. The trade name has a remaining life of 5 years and can be renewed at nominal cost indefinitely. The copyright has a remaining life of 40 years.
Prepare the intangible assets section of Marin Golf Inc. at
December 31, 2019.
MARIN GOLF INC. |
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enter a balance sheet item |
$enter a dollar amount |
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enter a balance sheet item |
enter a dollar amount |
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enter a balance sheet item |
enter a dollar amount |
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select a closing section name Current AssetsCurrent LiabilitiesExpensesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesNet Income / (Loss)Property, Plant and EquipmentRevenuesStockholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal ExpensesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders' EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal RevenuesTotal Stockholders' Equity |
$enter a total amount for this section |
How much amortization expense is included in Marin income for the
year ended December 31, 2019?
Amortization expense |
Answer | ||
Purchase price |
$ 780,000 | |
Fair value of assets | $ 830,000 | |
Less: Fair value of liabilities | $ 200,000 | |
Fair value of net assets | $ 630,000 | |
Goodwill | $ 150,000 | |
1 | ||
Intangibles Section of Balance Sheet | ||
December 31, 2019 | ||
Goodwill | $ 150,000 | |
Copyrights | $ 37,920 | 38400-480 |
Trade Names | $ 8,000 | |
Total Intangible Assets | $ 195,920 | |
2 | ||
Amortization expense | $ 540 | 38400/40*6/12 |
Marin Golf Inc. was formed on July 1, 2019, when Matt Magilke purchased the Old Master...
Marin Golf Inc. was formed on July 1, 2019, when Matt Magilke purchased the Old Master Golf Company. Old Master provides video golf instruction at kiosks in shopping malls. Magilke plans to integrate the instructional business into his golf equipment and accessory stores. Magilke paid $780,000 cash for Old Master. At the time, Old Master’s balance sheet reported assets of $670,000 and liabilities of $200,000 (thus owners’ equity was $470,000). The fair value of Old Master’s assets is estimated to...
Windsor Golf Inc. was formed on July 1, 2019, when Matt Magilke purchased the Old Master Golf Company. Old Master provides video golf instruction at kiosks in shopping malls. Magilke plans to integrate the instructional business into his golf equipment and accessory stores. Magilke paid $810,000 cash for Old Master. At the time, Old Master’s balance sheet reported assets of $660,000 and liabilities of $190,000 (thus owners’ equity was $470,000). The fair value of Old Master’s assets is estimated to...
Kingbird Golf Inc. was formed on July 1, 2019, when Matt Magilke purchased the Old Master Golf Company. Old Master provides video golf instruction at kiosks in shopping malls. Magilke plans to integrate the instructional business into his golf equipment and accessory stores. Magilke paid $850,000 cash for Old Master. At the time, Old Master’s balance sheet reported assets of $650,000 and liabilities of $190,000 (thus owners’ equity was $460,000). The fair value of Old Master’s assets is estimated to...
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Problem 3. (100 Points) Larkspur Golf Inc. was formed on July 1, 2019, when Matt Magilke purchased the Old Master Golf Company. Old Master provides video golf instruction at kiosks in shopping malls. Magilke plans to integrate the instructional business into his golf equipment and accessory stores. Magilke paid $770,000 cash for Old Master. At the time, Old Master's balance sheet reported assets of $670,000 and liabilities of $210,000. The fair value of Old Master's assets is estimated to be...
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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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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...