1-3 (L01,2,5) (Accounting for Franchise, Patents, and Trademark) Information concerning Sandro Corporation's intan 1. On January 1, 2017, Sandro signed an agreement to operate as a franchisee of Hsian Copy Service, Inc. for an initial franchise payments of $15,000 each, beginning January 1, 2018. The agreement provides that the down payment is not refundable and fee of $75,000. Of this amount, $15,000 was paid when the agreement was signed, and the balance is payable in 4 annual no future services are required of the franchisor. The present value at January 1, 2017, of the 4 annual payments discounted at 14% (the implicit rate for a loan of this type) is $43,700. The agreement also provides that 5% of the revenue from the franchise must be paid to the franchisor annually. Sandro's revenue from the franchise for 2017 was $900,000. Sandro esti- counting treatment for the franchise fee and payments.) Id pale assets is as follows 2 Sandro incurred $65.000 of experimental and development costs in its laboratory to develop a patent that was granted on January 2. 2017. Legal fees and other costs associated with registration of the patent totaled $17.660, Sandro estimates that the useful life of the patent will be 8 years A trademark was purchased from Shanghai Company for $36,000 on July 1, 2014. Expenditures for successful litigation in defense of the trademark totaling $10,200 were paid on July 1, 2017. Sandro estimates that the useful life of the trademark will be 20 years from the date of acquisition Instructions G) Prepare a schedule showing the intangible assets section of Sandro's balance sheet at December 31, 2017. Show support- ing computations in good form. (b) Prepare a schedule showing all expenses resulting from the transactions that would appear on Sandro's income state- ment for the year ended December 31, 2017. Show supporting computations in good form. (AICPA adapted) L