Cullumber Company, organized in 2019, has set up a single account for all intangible assets. The following summary discloses the debit entries that have been recorded during 2020.
1/2/20 | Purchased patent (8-year life) |
$354,400 |
||
4/1/20 | Purchase goodwill (indefinite life) |
353,000 |
||
7/1/20 | Purchased franchise with 10-year life; expiration date 7/1/30 |
433,000 |
||
8/1/20 | Payment of copyright (5-year life) |
159,600 |
||
9/1/20 | Research and development costs |
223,000 |
||
$1,523,000 |
Prepare the necessary entry to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Account Titles and Explanation |
Debit |
Credit |
---|---|---|
enter an account title |
enter a debit amount |
enter a credit amount |
enter an account title |
enter a debit amount |
enter a credit amount |
enter an account title |
enter a debit amount |
enter a credit amount |
enter an account title |
enter a debit amount |
enter a credit amount |
enter an account title |
enter a debit amount |
enter a credit amount |
enter an account title |
enter a debit amount |
enter a credit amount |
eTextbook and Media
List of Accounts
Make the entry as of December 31, 2020, recording any necessary amortization. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Account Titles and Explanation |
Debit |
Credit |
---|---|---|
enter an account title |
enter a debit amount |
enter a credit amount |
enter an account title |
enter a debit amount |
enter a credit amount |
enter an account title |
enter a debit amount |
enter a credit amount |
enter an account title |
enter a debit amount |
enter a credit amount |
eTextbook and Media
List of Accounts
Reflect all balances accurately as of December 31, 2020.
Use straight-line amortization | ||
---|---|---|
select an intangible asset FranchisesCopyrightsResearch and development costsGoodwillPatents |
$enter a dollar amount |
|
select an intangible asset PatentsResearch and development costsCopyrightsFranchisesGoodwill |
$enter a dollar amount |
|
select an intangible asset CopyrightsGoodwillFranchisesResearch and development costsPatents |
$enter a dollar amount |
|
select an intangible asset CopyrightsPatentsFranchisesGoodwillResearch and development costs |
$enter a dollar amount |
ANSWER
a) | |||
Account Titles and Explanation | Debit | Credit | |
Patents | 354400 | ||
Goodwill | 353000 | ||
Franchise | 433000 | ||
Copyright | 159600 | ||
Research and Development Expenses | 223000 | ||
Intangible Assets | 1523000 | ||
b). | |||
Account Titles and Explanation | Debit | Credit | |
Amortization Expense | 79250 | ||
Patents | 44300 | =354400/8 | |
Franchise | 21650 | =433000/10*6/12 | |
Copyright | 13300 | =159600/5*5/12 | |
c). | |||
Patents | 310100 | =354400-44300 | |
Goodwill | 353000 | ||
Franchises | 411350 | =433000-21650 | |
Copyrights | 146300 | =159600-13300 |
_____________________________________________
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Cullumber Company, organized in 2019, has set up a single account for all intangible assets. The...
Cullumber Company, organized in 2019, has set up a single account for all intangible assets. The following summary discloses the debit entries that have been recorded during 2020. 1/2/20 Purchased patent (8-year life) $354,400 4/1/20 Purchase goodwill (indefinite life) 353,000 7/1/20 Purchased franchise with 10-year life; expiration date 7/1/30 433,000 8/1/20 Payment of copyright (5-year life) 159,600 9/1/20 Research and development costs 223,000 $1,523,000 Prepare the necessary entry to clear the Intangible Assets account and to set up separate accounts...
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