Larry Was the Holder of a Patent on a Video

question 11

Essay

Larry was the holder of a patent on a video game.During 2013,he sold all substantial rights in the patent for $365,000 in cash and a 3% royalty on the purchaser's first $10,200,000 of sales each year related to the product in which the patent is incorporated.Larry had not reduced the patent to practice.He had a $86,000 basis for the patent.During 2013,he received $30,000 in royalties.What is the nature and amount of Larry's gain?

---

Definitions:

Hypnotherapy

A therapeutic technique that uses hypnosis to create subconscious change in the form of new responses, thoughts, attitudes, behaviors, or feelings.

Social Skills Training

A behavior-therapy method for helping people in their interpersonal relations that utilizes self-monitoring, behavior rehearsal, and feedback.

Gestalt Therapy

This psychotherapy approach highlights the importance of personal accountability while concentrating on what the individual feels right now, the bond between therapist and client, the influence of a person's social and environmental settings, and the self-adjustments made in response to their broad circumstances.

Client-Centered Therapy

A humanistic approach to psychotherapy that emphasizes an individual's inherent capacity for self-healing and personal growth, with the therapist offering unconditional positive regard.