The Shane Company Began Business Early in 2016, When Shane

question 11

Multiple Choice

The Shane Company began business early in 2016, when Shane paid an initial fee of $100,000 to purchase a franchise. In forming the company, Shane also spent $11,000 on legal fees and $4,500 on accounting fees. During the year, Shane spent $7,500 on product development and paid $10,000 in continuing franchise fees. What amount should Shane capitalize for intangible assets in 2016?

• A) $100,000
• B) $115,500
• C) $123,000
• D) $133,000

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Definitions:

Algebraic Expression

A mathematical phrase that can include numbers, variables, and operation symbols but does not have an equals sign.

Janitorial Department

The division or section within an organization responsible for maintaining the cleanliness, order, and upkeep of the premises.

Maintenance Department

A functional area within an organization responsible for the upkeep of physical assets, machinery, and buildings.

Support Department Costs

Expenses that are not directly tied to the production of goods or services but are necessary for supporting the operations of a business, like IT or HR departments.