For Each of the Following Unrelated Transactions, (A) Determine the Amount

question 187

Essay

For each of the following unrelated transactions, (a) determine the amount of the amortization for the current year, and (b) present the adjusting entries required to record amortization at year end.
(1) Costs (it was not acquired) of $39,000 were incurred on January 1 to obtain a patent. On January 31, $38,610 was spent in legal costs to successfully defend the patent against competitors. The patent has an estimated legal life of 12 years.
(2) A company acquired a copyright for $160,000. The copyright has a useful life of 50 years.

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Definitions:

Relationship

A connection, association, or involvement between people, entities, or concepts.

Record

An item of stored information, such as in a database, often consisting of multiple fields to represent different attributes of something.

Table

A collection of data organized in rows and columns, commonly used in databases and spreadsheets.

Field

In a database context, an area allocated for a specific piece of data, such as a name or address, within a record.