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Materials and equipment $171.000 Personnel 287,000 Indirect costs 22.000 $480,000 Ivanhoe estimates that these costs will be recouped by December 31, 2020. The materials and
Materials and equipment $171.000 Personnel 287,000 Indirect costs 22.000 $480,000 Ivanhoe estimates that these costs will be recouped by December 31, 2020. The materials and equipment purchased have no alternative uses. A patent was purchased from Pharoah Company for $1,190,000 on January 1, 2016. Ivanhoe estimated the remaining useful life of the patent to be 10 years. The patent was carried in Pharoah's accounting records at a net book value of $1,770,000 when Pharoah sold it to Ivanhoe. . During 2017, a franchise was purchased from Clinton Company for $356,000. In addition, 5% of revenue from the franchise must be paid to Clinton. Revenue from the franchise for 2017 was $1,320,000. Ivanhoe estimates the useful life of the franchise to be 10 years and takes a full year's amortization in the year of purchase. On January 1, 2017, because of recent events in the field, Ivanhoe estimates that the remaining life of the patent purchased on January 1, 2016, is only 5 years from January 1, 2017 Prepare a schedule showing the intangibles section of Ivanhoe's balance sheet at December 31, 2017. (Enter account name only and do not provide descriptive information.) IVANHOE COMPANY Intangibles Section of Balance Sheet Prepare a schedule showing the income statement effect (related to expenses) for the year ended December 31, 2017, as a result of the facts above. (Enter account name only and do not provide descriptive information.) IVANHOE COMPANY Income Statement Effect
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