Information concerning Miley's intangible assets is as follows.

1. On January 1, 2019, Miley signed an agreement to operate as a franchisee of Godiva for an initial franchise fee of $150,000. Of this amount, $30,000 was paid when the agreement was signed, and the balance is payable in annual payments of $30,000 each, beginning January 1, 2020. The agreement provides that the down payment is not refundable and no future services are required of the franchisor. The present value at January 1, 2019, of the four annual payments discounted at 14% (the implicit rate for a loan of this type) is $87,400. Miley estimates the useful life of the franchise to be 10 years.

2. Miley incurred $130,000 of experimental and development costs in its laboratory to develop a patent that was granted on January 2, 2019. Legal fees and other costs associated with registration of the patent totaled $35,200. Miley estimates that the useful life of the patent will be 8 years. The patent has yet to achieve economic viability.

3. A trademark was purchased from Edward Company for $72,000 on July 1, 2016. Expenditures for successful litigation in defense of the trademark totaling $20,400 were paid on July 1, 2019. Miley estimates that the useful life of the trademark will be 20 years from the date of acquisition.

Instructions:

Prepare the journal entries needed in 2019!