Munn Inc. reported other noncurrent asset account balances on December 31, 2020, as follows.

Patent $288,000

Accumulated amortization (36,000)

Net patent $252,000

Transactions during 2021 and other information relating to Munns other noncurrent assets include the following.

The patent was purchased from Grey Company on January 2, 2019, when the remaining legal life was 16 years. On January 1, 2021, Munn determined that the remaining useful life of the patent was only eight years from the date of its acquisition.

On January 1, 2021, in connection with the purchase of a trademark from Cody Corp., the parties entered into a noncompetition agreement. Munn paid Cody $1,200,000, of which 75% related to the trademark and 25% reflected Codys agreement not to compete for a period of five years in the line of business covered by the trademark. Munn considers the life of the trademark to be indefinite.

Munn incurred the following research and development costs in 2021.

Salaries and related expenses to development of patent $187,500

Supplies 22,500

Allocated facility costs 30,000

Required:

Given the information above, prepare all necessary journal entries.