These are selected 1998 transactions for Graf Corporation:

Jan. 1 Purchased a small company and recorded goodwill of \(\$ 120,000\). The goodwill has a useful life of 55 years.

May 1 Purchased a patent with an estimated useful life of 5 years and a legal life of 17 years for \(\$ 15,000\).

\section*{Instructions}

Prepare all adjusting entries at December 31 to record amortization required by the events.

Prepare entries to set up appropriate accounts for different intangibles; calculate amortization. (SO 7)

Answer questions of depreciation and intangibles. \((\mathrm{SO} 2,7\) )