Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Tones Industries has the following patents on its December 31, 2024, balance sheet. Patent Item Patent A 2. 1. 3. Patent B Patent C Year

Tones Industries has the following patents on its December 31, 2024, balance sheet. Patent Item Patent A 2. 1. 3. Patent B Patent C Year 2026 Initial Cost 2027 $30,600 $15,000 $14,400 The following events occurred during the year ended December 31, 2025. Expected Future Cash Flows Date Acquired $2,000 3/1/21 2,000 7/1/22 9/1/23 Research and development costs of $245,700 were incurred during the year. Patent D was purchased on July 1 for $36,480. This patent has a useful life of 9/2 years. As a result of reduced demands for certain products protected by Patent B, a possible impairment of Patent B's value may have occurred at December 31, 2025. The controller for Tones estimates the expected future cash flows from Patent B will be as follows. Useful Life at Date Acquired 17 years 10 years 4 years
image text in transcribed
image text in transcribed
image text in transcribed
Tones Industries has the following patents on its December 31,2024 , balance sheet. The following events occurred during the year ended December 31, 2025. 1. Research and development costs of $245,700 were incurred during the year. 2. Patent D was purchased on July 1 for $36,480. This patent has a useful life of 91/2 years. 3. As a result of reduced demands for certain products protected by Patent B, a possible impairment of Patent B's value may have occurred at December 31,2025. The controller for Tones estimates the expected future cash flows from Patent B will be as follows. The proper discount rate to be used for these flows is 8%. (Assume that the cash flows occur at the end of the year.) Click here to view factor tables. (a) Your answer is correct. Compute the total carrying amount of Tones' patents on its December 31, 2024, balance sheet. (Round answer to 0 decimal places e.8. 5,125.) Compute the total carrying amount of Tones' patents on its December 31, 2025, balance sheet. (Round present value foctor calculations to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places e.g. 58,971.) Total carrying amount

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

Cost Benefit Analysis Theory And Application

Authors: Tevfik F. Nas

1st Edition

080397132X, 978-0803971325

More Books

Students also viewed these Accounting questions