Accounting Problem (Question 5)

Instructions

Refer to Question 5 Part 1.png and Question 5 Part 2.png, prepare the necessary Journal Entries, use the list of Accounts Below.

List of Accounts

• Accounts Payable
• Accounts Receivable
• Accumulated Amortization - Copyrights
• Accumulated Amortization - Customer Lists
• Accumulated Amortization - Customer Database
• Accumulated Amortization - Development Costs
• Accumulated Amortization - Franchises
• Accumulated Amortization - Licences
• Accumulated Amortization - Patents
• Accumulated Amortization - Software
• Accumulated Amortization - Trademarks
• Accumulated Depreciation
• Accumulated Impairment Losses - Goodwill
• Accumulated Impairment Losses - Licences
• Accumulated Impairment Losses - Patents
• Accumulated Impairment Losses - Trademark
• Accumulated Impairment Losses - Trade Names
• Accumulated Impairment Losses - Copyrights
• Administrative Expenses
• Advances to Employees
• Advertising Expense
• Allowance for Doubtful Accounts
• Amortization Expense
• Bad Debt Expense
• Bank Loans
• Buildings
• Cash
• Common Shares
• Copyright
• Cost of Goods Sold
• Customer Database
• Customer Lists
• Delivery Expense
• Depreciation Expense
• Development Costs
• Discount on Bonds Payable
• Due from Factor
• Due to Customer
• Equipment
• Fair Value - NI Investments
• Finance Expense
• Finance Revenue
• Franchises
• Freight-In
• Freight-Out
• Gain on Disposal of Intangible Assets
• Gain on Sale of Equipment
• Gain on Sale of Land
• Goodwill
• Income Summary
• Intangible Assets
• Intangible Assets-Copyrights
• Intangible Assets-Customer List
• Intangible Assets-Development Costs
• Intangible Assets-Licences
• Intangible Assets-Franchises
• Intangible Assets-Patents
• Intangible Assets-Software (Old)
• Intangible Assets-Software (New)
• Intangible Assets-Trademarks
• Intangible Assets-Trade Names
• Interest Expense
• Interest Income
• Interest Receivable
• Inventory
• Land
• Leasehold Improvements
• Licences
• Licensing Agreement
• Loss on Disposal of Intangible Assets
• Loss on Impairment
• Loss on Impairment - Goodwill
• Loss on Impairment - Licences
• Loss on Impairment - Trademarks
• Loss on Impairment - Patents
• Loss on Sale of Copyright
• Loss on Sale of Receivables
• Machinery
• Maintenance and Repairs Expense
• Miscellaneous Expense
• No Entry
• Notes Payable
• Notes Receivable
• Office Expense
• Office Expense - Bank Charges
• Operating Expenses
• Patents
• Petty Cash
• Prepaid Expenses
• Prepaid Rent
• Purchase Discounts
• Recovery of Loss from Impairment
• Rent Expense
• Research and Development Expense
• Resource Liability
• Retained Earnings
• Revaluation Gain or Loss
• Revaluation Surplus (OCI)
• Royalty Expense
• Sales
• Sales Discounts
• Sales Discounts Forfeited
• Sales Revenue
• Selling Expenses
• Servicing Liability
• Service Revenue
• Sick Pay Wages Payable
• Software
• Start-up Expenses
• Supplies
• Supplies Expense
• Trademarks
• Trade Names
• Unearned Revenue
• Unrealized Gain or Loss - FV-NI

Background

SunlandLimited organized late in 2019 and set up a single account for all intangible assets. The following summary shows the entries in 2020 (all debits) that have been recorded in Intangible Assets since then

Jan.2

Purchased patent (8-year life)$343,000

Mar.31

Costs to search for new ways to apply patent that was purchased on Jan. 2 $21,000

Apr.1

Purchased goodwill (indefinite life)$300,000

July1

• Purchased franchise with10-year life; expiration date July 1, 2030$264,000
• Promotional costs to increase the future economic benefit of the goodwill that was purchased on Apr. 1 $33,000

Aug.1

Payment for copyright (5-year life)152,4001Purchased trademark (3-year life)14,4001Purchased customer list (2-year life)9,600Sept.1Research costs$231,000

Total:$1,368,400

Part 1

Prepare the necessary entry to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit CreditMake the entry as at December 31, 2020, for any necessary amortization so that all balances are accurate as at that date. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to O decimal places, e.g. 5,275.) Account Titles and Explanation Debit Credit eTextbook and Media List of Accounts Provide the asset amounts reported on the December 31, 2020 statement of financial position. (Round answers to O decimal places, e.g. 5,275.) Patents Franchise Copyright Trademark Customer list Goodwill