ACQUISITION AND AMORTIZATION OF INTANGIBLE ASSETS TLM Technologies had these transactions related to intangible assets during 2009.

Jan. 2 Purchased a patent from Luna Industries for $200,000. The remaining legal life of the patent is 15 years and TLM expects the patent to be useful for 8 years.

5 Paid legal fees in a successful legal defense of the patent of $80,000.

June 29 Registered a trademark with the federal government. Registration costs were

$12,000. TLM expects to use the trademark indefinitely.

Sept. 2 Paid research and development costs of $500,000.

Required:

. Prepare the journal entries necessary to record the transactions.

. Prepare the entries necessary to record amortization expense for the intangible assets.

. What is the balance of the intangible assets at the end of 2009?

Exercise