Question
Culver Corporation purchases a patent from Sunland Company on January 1, 2020, for $78,000. The patent has a remaining legal life of 16 years. Culver
Culver Corporation purchases a patent from Sunland Company on January 1, 2020, for $78,000. The patent has a remaining legal life of 16 years. Culver feels the patent will be useful for 10 years. Assume that at January 1, 2022, the carrying amount of the patent on Culvers books is $62,400. In January, Culver spends $25,600 successfully defending a patent suit. Culver still feels the patent will be useful until the end of 2029. Prepare the journal entries to record the $25,600 expenditure and 2022 amortization. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Account Titles and Explanation | Debit | Credit |
---|---|---|
enter an account title to record expenditure of patents | enter a debit amount | enter a credit amount |
enter an account title to record expenditure of patents | enter a debit amount | enter a credit amount |
(To record expenditure of patents) | ||
enter an account title to record amortization expense | enter a debit amount | enter a credit amount |
enter an account title to record amortization expense | enter a debit amount | enter a credit amount |
(To record amortization expense) |
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