As the recently appointed auditor for Ng Corporation, you have been asked to examine selected accounts before the 6-month financial statements of June 30, 2015, are prepared. The controller for Ng Corporation mentions that only one account is kept for intangible assets.

Instructions Prepare the entry or entries necessary to correct this account. Assume that the patent has a useful life of 12 years.

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Intangible Assets Debit Credit Balance Jan. 4 Research and development costs (prior to achieving economic viability) HK$940,000 HK$ 940,000 Jan. 5 Legal costs to obtain patent 75,000 1,015,000 Jan. 31 Payment of 7 months' rent on property leased by Ng 91,000 1,106,000 Feb. 11 Share premium on ordinary shares HK$250,000 856,000 March 31 Unamortized bond discount on bonds due March 31, 2035 84,000 940,000 April 30 Promotional expenses related to start-up of business 207,000 1,147,000 June 30 Operating losses for first 6 months 141,000 1,288,000