Carey Corporation has five different intangible assets to be accounted for and reported on the financial statements. The management is concerned about the amortization of the cost of each of these intangibles.
Facts about each intangible follow:
a. Goodwill. The company started business in January 2012 by purchasing another business for a cash lump sum of $650,000. Included in the purchase price was “Goodwill, $75,000.” Company executives stated that “the goodwill is an important long-lived asset to us.” It has an indefinite life.
b. Patent. The company purchased a patent at a cash cost of $18,600 on January 1, 2014. It is amortized over its expected useful life of 10 years.
c. Copyright. On January 1, 2014, the company purchased a copyright for $24,750 cash. It is estimated that the copyrighted item will have no value by the end of 30 years.
d. Franchise. The company obtained a franchise from Cirba Company to make and distribute a special item. It obtained the franchise on January 1, 2014, at a cash cost of $19,200 for a 12-year period.
e. License. On January 1, 2013, the company secured a license from the city to operate a special service for a period of seven years. Total cash expended to obtain the license was $21,700.

Required:
1. Compute the amount of amortization that should be recorded for each intangible asset at the end of the annual accounting period, December 31, 2014.
2. Give the book value of each intangible asset on January 1, 2017.
3. Assume that on January 2, 2017, the franchise was impaired in its ability to continue to produce strong revenues. The other intangible assets were not affected. Carey estimated that the franchise would be able to produce future cash flows of $13,500. The fair value of the franchise was determined to be $12,000. Compute the amount, if any, of the impairment loss to be recorded.