The following information concerns the intangible assets of Baez Corporation: On June 30, 2024, Baez completed the acquisition of the Johnstone Corporation for $1,580,000 in cash. The fair value of the net identifiable assets of Johnstone was $1,350,000. Included in the assets purchased from Johnstone was a patent that was valued at $60,200. The remaining legal life of the patent was 12 years, but Baez believes that the patent will only be useful for another seven years. Baez acquired a franchise on October 1, 2024, by paying an initial franchise fee of $154,800. The contractual life of the franchise is 9 years.

Required: Prepare year-end adjusting journal entries to record straight-line amortization expense of the intangibles at December 31, 2024. Prepare the intangible asset section of the December 31, 2024, balance sheet.