The following information relates to the intangible assets of University Testing Services (UTS): a. On January 1,

Question:

The following information relates to the intangible assets of University Testing Services (UTS):
a. On January 1, 2021, UTS completed the purchase of Heinrich Corporation for $3,510,000 in cash. The fair value of the net identifiable assets of Heinrich was $3,200,000.
b. Included in the assets purchased from Heinrich was a patent valued at $82,250. The original legal life of the patent was 20 years; there are 12 years remaining, but UTS believes the patent will be useful for only seven more years.
c. UTS acquired a franchise on July 1, 2021, by paying an initial franchise fee of $333,000. The contractual life of the franchise is 9 years.


Required:
1. Record amortization expense for the intangible assets at December 31, 2021.
2. Prepare the intangible asset section of the December 31, 2021, balance sheet.

Intangible Assets
An intangible asset is a resource controlled by an entity without physical substance. Unlike other assets, an intangible asset has no physical existence and you cannot touch it.Types of Intangible Assets and ExamplesSome examples are patented...
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Financial Accounting

ISBN: 978-1259914898

5th edition

Authors: David Spiceland, Wayne M. Thomas, Don Herrmann

Question Posted: