2) A companys legal department received notice that a patent giving the company the exclusive right to see a new type of software was approved. It is believed that the patent will produce annual sales of $200,000 per year if there is demand for the software. Assume a discount rate of 7% compounded annually.

Required: What value should the patent account be created at if the company has predicted that the demand for the software will last for approximately 4 years?

3) Required: Prepare the following journal entries in good form:

a) Sold inventory for cash, $3,500. The cost of the inventory was $2,000.

b) Received a $150 invoice from the local newspaper requesting payment for an advertisement that the Company

c) Purchased equipment on account for $5,500 from the Marshall Company. The full amount is due in 10 days.

d) Received $4,000 from customers on account.

e) Paid $3,000 of the amount due to Marshall Company.

What is the total amount of liabilities owed as a result of the 5 transaction above?