Question

On October 1, 2019, Priscilla purchased a business of the purchase price,'$70,000 is allocated to a patent and $120,000 to goodwill. If required, round your intermediate values to nearest dollar and use in subsequent computations. Calculate Priscilla's 2019 $ 197 amortization deduction $ 7,417 x Check My Wor Taxpayers can daim an amortization deduction on intangible assets called "amortizable 5 197 intangibles." Ched My Work 1 more Check My Work remaining | 8 9 0

Answer 1

Answer:

Priscilla's 2019 & Amortization Deduction = $8,167

Explanation:

Value of Patent = $70,000

Value of Goodwill = $420,000

The 2019 and 197 amortization deduction is calculated as follows :

Patent = $70,000/15 years * 3/12 = $1,166.67 (approx.)

Goodwill = $420,000/15 years * 3/12 =. $7,000

Total Amortization deduction = $7,000 + $1,166.67 = $8,166.67 = $8,167 (approx.)