Prepare the journal entry to record the exchange of the delivery truck on December 1, 2018.

1) On December 1, 2018, ABC Co. exchanges an old delivery truck for a new truck. The old truck originally cost $40,000 on December 1, 2014 and has a current fair value of $4,750. The Accumulated Depreciation account related to the old delivery truck was $36,250 on the date of exchange. The new truck has a list price of $35,000. The dealer gave ABC Co. a $5,000 trade-in allowance.

2) For the below transactions, record the appropriate adjusting journal entry for amortization at year-end on December 31, 2020. If no entry is required, state so and explain why.

a) McLaughlin Inc. purchased another company on July 1, 2020, and recorded Goodwill of $400,000.

b) McLaughlin Inc. purchased a Patent for $18,000 on January 1, 2020. In addition, $9,000 was spent in legal costs on January 1, 2020, to successfully defend the Patent in court against competitors. The Patent has a legal life of 20 years and an estimated useful life of 9 years.

c) The company purchased a Trademark for $25,000 on May 1, 2020. The rights to the trademark can be renewed indefinitely.