Marshall 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) $ 350,000 4/1/20 Purchase goodwill (indefinite life) 360,000 7/1/20 Purchased franchise with 10-year life; expiration date 7/1/30 450,000 8/1/20 Payment of copyright (5-year life) 156,000 9/1/20 Research and development costs 215,000 $1,531,000 Instructions Prepare the necessary entries to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles. Make the entries as of December 31, 2020, recording any necessary amortization and reflecting all balances accurately as of that date. (Use straight-line amortization.)
Marshall 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) $ 350,000 4/1/20 Purchase goodwill (indefinite life) 360,000 7/1/20 Purchased franchise with 10-year life; expiration date 7/1/30 450,000 8/1/20 Payment of copyright (5-year life) 156,000 9/1/20 Research and development costs 215,000 $1,531,000 Instructions Prepare the necessary entries to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles. Make the entries as of December 31, 2020, recording any necessary amortization and reflecting all balances accurately as of that date. (Use straight-line amortization.)
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter11: Depreciation, Depletion, Impairment, And Disposal
Section: Chapter Questions
Problem 7P: Dinnell Company owns the following assets: In the year of acquisition and retirement of an asset,...
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Marshall 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) |
$ 350,000
|
| 4/1/20 | Purchase |
360,000
|
| 7/1/20 | Purchased franchise with 10-year life; expiration date 7/1/30 |
450,000
|
| 8/1/20 | Payment of copyright (5-year life) |
156,000
|
| 9/1/20 | Research and development costs |
215,000
|
|
$1,531,000
|
Instructions
Prepare the necessary entries to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles. Make the entries as of December 31, 2020, recording any necessary amortization and reflecting all balances accurately as of that date. (Use straight-line amortization.)
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