Intangible Assets On November 15, WTG purchased a patent for $49,500. It used an installment loan to purchase the patent. Payments are due on May 15 and November 15 of every year (so the 1st payment is due May 15 next year) for the next 5 years. The interest rate is 7%. WTG's existing intangible assets were purchased on January 1 of the first year that WTG was in business. Information on basis and amortization is included in the "Intangible Assets" worksheet in the "Long Term Operating Assets" spreadsheet. Tax Considerations Assume, for the sake of simplicity, that all intangible assets on WTG's balance sheet are Section 197 intangible assets. Accounting and Business Policies For book purposes, WTG amortizes its patents over 20 years, using the straight-line method and half-year convention. 

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