Professional Simulation In this simulation, you are asked to address questions related to intangible assets and similar costs. Prepare responses to all parts.

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KWW_Professional_Simulation Intangible Assets Time Remaining 0 hours 40 minutes Directions Situation Journal Entries Measurement Financial Statements Resources E copy standard help Argot Co., organized in 2014, provided you with the following information. 1. Purchased a franchise for $36,000 on July 1, 2014. The rights to the franchise will expire on July 1, 2022. 2. Incurred a net loss of $33,000 in 2014, including a governmental incorporation fee of $2,000 and related legal fees of organizing, $5,000. (All fees were incurred in 2014.) 3. Purchased a patent on January 2, 2015, for $60,000. It is estimated to have a 10-year life. 4. Costs incurred to develop a secret formula as of March 1, 2015, were $90,000. The secret formula has an indefinite life. 5. On April 1, 2015, Argot Co. purchased a small manufacturing concern for $700,000. Goodwill recorded in the transaction was $180,000. 6. On July 1, 2015, legal fees for successful defense of the patent purchased on January 2, 2015, were $9,500. 7. Research and development costs incurred as of September 1, 2015, were $110,000 ($28,000 of these costs related to the patent in item 3 were incurred subsequent to achieving economic viability). Directions Situation Journal Entries Measurement Financial Statements Resources Prepare the journal entries to record all the entries related to the patent during 2015. Directions Situation Journal Entries Measurement Financial Statements Resources At December 31, 2015, an impairment test is performed on the franchise purchased in 2014. It is estimated that the net cash flows to be received from the franchise will be $25,000, and its recoverable amount is $13,000. Compute the amount of impairment, if any, to be recorded on December 31, 2015. Directions Situation Journal Entries Measurement Financial Statements Resources What is the amount to be reported for intangible assets on the statement of financial position at December 31, 2014? At December 31, 2015?