Haley Company, organized in 2014, has these transactions related to intangible assets in that year: Jan. 2Purchased

Question:

Haley Company, organized in 2014, has these transactions related to intangible assets in that year:

Jan. 2Purchased a patent (5-year life) $280,000.

Apr. 1 Goodwill acquired as a result of purchased business (indefinite life) $360,000.

July 1 Acquired a 9-year franchise; expiration date July 1, 2023, $540,000.

Sept.1 Research and development costs $185,000.

Instructions

(a) Prepare the necessary entries to record these transactions related to intangibles. All costs incurred were for cash.

(b) Make the entries as of December 31, 2014, recording any necessary amortization.

Goodwill
Goodwill is an important concept and terminology in accounting which means good reputation. The word goodwill is used at various places in accounting but it is recognized only at the time of a business combination. There are generally two types of... 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...