Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

2-step Impairment Testing for Trade Names On January 1, 2019, Outkast Corporation applied for a trade name, incurring legal costs of $16,000. On January 1,

2-step Impairment Testing for Trade Names

On January 1, 2019, Outkast Corporation applied for a trade name, incurring legal costs of $16,000. On January 1, 2020, Outkast incurred $7,200 of legal fees in a successful defense of its trade name. All expenditures were made with cash. Outkast amortizes the trade name over 10 years.

On January 3, 2021, new market research revealed estimated future cash flows from the trade name to be $18,000 and the fair value to be $16,000.

Prepare all journal entries relating to this trade name for 2019 to 2023.

Date

Account

Debit

Credit

01/01/2019

12/31/2019

01/01/2020

12/31/2020

01/03/2021

12/31/2021

12/31/2022

12/31/2023

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Application Of Quantitative Techniques For The Prediction Of Bank Acquisition Targets

Authors: Pasiouras Fotios

1st Edition

9812565183, 9789812565181

More Books

Students also viewed these Accounting questions