Morgan Printers incurred external costs of $900,000 for a patent for a new laser printer. Although the patent gives legal protection for 20 years, it was expected to provide Morgan with a competitive advantage for only nine years due to expected technological advances in the industry. Morgan uses the straight-line method of amortization (Click the icon to view additional information) Read the requirements Requirement 1. Make journal entries to record (a) the purchase of the patent and (b) amortization for year 1. (Record debits first, then credits. Exclude explanations from any Journal entries Start by recording (a) the purchase of the patent Journal Entry Accounts Date Debit Credit - X More info Requirements 1. Make journal entries to record(a) the purchase of the patent and (b) amortization for year 1 2. Once Morgan learned of the competing printer and adjusted the expected future cash flows from its original patent, was this asset impaired? if so, make the impairment adjusting entry After using the patent for six years, Morgan leamed at an industry trade show that Stanley Printers has patented a more efficient printer and will be selling this printer next quarter Because of this new information, Morgan determined that the expected future cash flows from its patent were now only $230,000. The fair value of Morgan's patent on the open market was now zero