Blossom Company has provided information on intangible assets as follows. A patent was purchased from Kingbird Company for $1,600,000 on January 1, 2019. Blossom estimated the remaining useful life of the patent to be 10 years. The patent was carried in Kingbird's accounting records at a net book value of $1,600,000 when Kingbird sold it to Blossom. During 2020, a franchise was purchased from Ayayai Company for $450,000. In addition, 5% of revenue from the franchise must be paid to Ayayai. Revenue from the franchise for 2020 was $2,300,000. Blossom estimates the useful life of the franchise to be 10 years and takes a full year's amortization in the year of purchase. Blossom incurred research and development costs in 2020 as follows. Materials and equipment Personnel $140,000 180,000 Indirect costs 100,000 $420,000 Blossom estimates that these costs will be recouped by December 31, 2023. The materials and equipment purchased have no alternative uses. On January 1, 2020, because of recent events in the field, Blossom estimates that the remaining life of the patent purchased on January 1, 2019, is only 5 years from January 1, 2020. Prepare the intangibles section of Blossom's balance sheet at December 31, 2020. (Enter account name only and do not provide descriptive information.) Current Assets BLOSSOM COMPANY Current Liabilities Intangibles Section of Balance Sheet Intangible Assets For the Year Ended December 31, 2020 Long-term Investments For the Month Ended December 31, 2020 Long-term Liabilities December 31, 2020 Property, Plant and Equipment Stockholders' Equity Total Assets Total Current Assets Total Current Liabilities Total Intangible Assets Total Liabilities Total Liabilities and Stockholders' Equity Total Long-term Investments $ Total Long-term Liabilities Total Property, plant and Equipment Total Stockholders' Equity $ Prepare the income statement effect (related to expenses) for the year ended December 31, 2020, as a result of the facts above. (Enter account name only and do not provide descriptive information.) Research and development costs Franchise from Ayayai Company Payment to Ayayai Company BLOSSOM COMPANY Total charged against income Income Statement Effect Amortization of franchise For the Year Ended December 31, 2020 Patent from Kingbird Company For the Month Ended December 31, 2020 Amortization of patent December 31, 2020 Amortization of franchise Total charged against income Patent from Kingbird Company Franchise from Ayayai Company Amortization of patent Payment to Ayayai Company Research and development costs Patent from Kingbird Company Amortization of patent Franchise from Ayayai Company Research and development costs Payment to Ayayai Company Total charged against income Amortization of franchise $ Total charged against income Patent from Kingbird Company Payment to Ayayai Company Research and development costs Amortization of franchise Franchise from Ayayai Company Amortization of patent Amortization of patent Patent from Kingbird Company Total charged against income Amortization of franchise Payment to Ayayai Company Research and development costs Franchise from Ayayai Company Franchise from Ayayai Company Amortization of franchise Total charged against income Patent from Kingbird Company Payment to Ayayai Company Amortization of patent Research and development costs
