Question
Skysong Golf Inc. was formed on July 1, 2019, when Matt Magilke purchased the Old Master Golf Company. Old Master provides video golf instruction at
Skysong Golf Inc. was formed on July 1, 2019, when Matt Magilke purchased the Old Master Golf Company. Old Master provides video golf instruction at kiosks in shopping malls. Magilke plans to integrate the instructional business into his golf equipment and accessory stores. Magilke paid $810,000 cash for Old Master. At the time, Old Masters balance sheet reported assets of $650,000 and liabilities of $220,000 (thus owners equity was $430,000). The fair value of Old Masters assets is estimated to be $840,000. Included in the assets is the Old Master trade name with a fair value of $6,000 and a copyright on some instructional books with a fair value of $52,800. The trade name has a remaining life of 5 years and can be renewed at nominal cost indefinitely. The copyright has a remaining life of 40 years.
Correct answer iconYour answer is correct.
Prepare the intangible assets section of Skysong Golf Inc. at December 31, 2019.
SKYSONG GOLF INC. Intangibles Section of Balance Sheet choose the accounting period For the Month Ended December 31, 2019December 31, 2019For the Year Ended December 31, 2019 | ||||||
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enter a balance sheet item | $enter a dollar amount | |||||
enter a balance sheet item | enter a dollar amount | |||||
enter a balance sheet item | enter a dollar amount | |||||
select a closing section name Current AssetsCurrent LiabilitiesExpensesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesNet Income / (Loss)Property, Plant and EquipmentRevenuesStockholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal ExpensesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders' EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal RevenuesTotal Stockholders' Equity | $enter a total amount for this section |
How much amortization expense is included in Skysong income for the year ended December 31, 2019?
Amortization expense | $enter Amortization expense in dollars |
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List of Accounts
New attempt is in progress. Some of the new entries may impact the last attempt grading.Your answer is partially correct.
Prepare the journal entry to record amortization expense for 2020. Prepare the intangible assets section of Skysong Golf Inc. at December 31, 2020. (No impairments are required to be recorded in 2020.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Account Titles and Explanation | Debit | Credit |
---|---|---|
enter an account title | enter a debit amount | enter a credit amount |
enter an account title | enter a debit amount | enter a credit amount |
SKYSONG GOLF INC. Intangibles Section of Balance Sheet choose the accounting period For the Year Ended December 31, 2020December 31, 2020For the Month Ended December 31, 2020 | ||||||
---|---|---|---|---|---|---|
enter a balance sheet item | $enter a dollar amount | |||||
enter a balance sheet item | enter a dollar amount | |||||
enter a balance sheet item | enter a dollar amount | |||||
select a closing section name Current AssetsCurrent LiabilitiesExpensesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesNet Income / (Loss)Property, Plant and EquipmentRevenuesStockholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal ExpensesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders' EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal RevenuesTotal Stockholders' Equity | $enter a total amount for this section |
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List of Accounts
Partially correct answer iconYour answer is partially correct.
At the end of 2021, Magilke is evaluating the results of the instructional business. Due to fierce competition from online and television (e.g., the Golf Channel), the Old Master reporting unit has been losing money. Its book value is now $460,000. The fair value of the Old Master reporting unit is $380,000. Magilke has collected the following information related to the companys intangible assets.
Intangible Asset | Expected Cash Flows (undiscounted) | Fair Values | ||
---|---|---|---|---|
Trade names | $18,000 | $6,000 | ||
Copyrights | 60,000 | 55,000 |
Prepare the journal entries required, if any, to record impairments on Skysong intangible assets. (Assume that any amortization for 2021 has been recorded.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Account Titles and Explanation | Debit | Credit |
---|---|---|
enter an account title | enter a debit amount | enter a credit amount |
enter an account title | enter a debit amount | enter a credit amount |
enter an account title | enter a debit amount | enter a credit amount |
eTextbook and Media
List of Accounts
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