Question

Gladow Corporation began operations in 2020 and has these transactions related to intangible sets in that year Jan. 2 Purchased a patent (5-year life) Apr. 1 Goodwill purchased as part of an acquisition of another company M 1 Acquired a 9-year franchise; expiration date July 1, 2025 Dec. 31 Determined that the recoverable amount of the patent and franchise to be $150,000 and 5473,000 respectively. There was no indication that the goodwill was impaired. $270,000 $324,000 $456,000 (a) Pl your answer is correct. Prepare the necessary entries to record these intangibles. Assume all costs incurred were for cash. (Credit accountries are automatically indented when the amount le entered. Do not Indent manually. Ir ne entry is reelect "No Entry for the account titles and enter for the amounts) Date Account Tities and Explanation Credit Jan. 2 Patents Cash 324000 (Part of the entry to record nurchase of another company)

pls help w d part

Answer 1

Please see the Corrected Answers below:-

Date	Account title and explanation	Debit	Credit
Dec 31	Amortization Expense- Patent	$ 54000
	Accumulated amortization - Patent		$54000

Franchise for 9 years and expiration date July 1, 2025

So the Franchise's start date is July 1, 2016. So 6 month to be considered

Annual Amortization Expense- Franchise = $ 486,000 / 9 = $ 54,000

Annual Amortization Expense- Franchise (July 1 - Dec 31 ) = $ 27,000

Dec 31	Amortization Expense- Franchise	$ 27000
	Accumulated amortization - Franchise		$ 27000

Dec 31	Loss on Impairment	$ 41000
	Accumulated impairment losses - Franchise		$ 41000