Due to rapid employee turnover in the accounting department, the following transactions involving intangible assets were recorded in a questionable way by Baiji Ltd. in the year ended December 31, 2009:

1. Baiji developed an electronic monitoring device for running shoes. It incurred research costs of $70,000 and development costs with probable future benefits of $45,000. It recorded all of these costs in the Patent account.

2. The company registered the patent for the 'cyber shoe' device developed in transaction 1. Legal fees and registration costs totalled $21,000. These costs were recorded in the Legal Fees Expense account.

3. The company successfully fought off a competitor in court to defend its patent, incurring $38,000 of legal fees. These costs were debited to the Legal Fees Expense account.

4. The company recorded $5,750 of annual amortization for the patent over its legal life of 20 years [70,000+45,000=115,000/20 years]. The expected useful life of the patent is 5 years. In calculating the amortization, assume that all costs occured at the beginning of the year.

5. Baiji tested the patent for impairment and found that its recoverable amount of $110,000 exceeded its carrying amount of $109,250 (115,000-5,750). Since Baiji follows the cost model, id did not record an adjustment.

Directions: Prepare the necessary journal entries to correct any errors made in recording the above transactions.