Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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

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

eTextbook and Media

Assistance Used

  • eTextbook 1
  • eTextbook 2
  • eTextbook 3

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

eTextbook and Media

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

Save for Later

Attempts: 1 of 3 used

Submit Answer

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Wiley CPAexcel Exam Review 2016 Study Guide January Auditing And Attestation

Authors: O. Ray Whittington

1st Edition

1119119960, 978-1119119968

More Books

Students also viewed these Accounting questions

Question

Is it clear what happens if an employee violates the policy?

Answered: 1 week ago