Intangible Asset Impairment Picot Collective Purchases a Patent on January 1, 2015 for 1

question 92

Essay

Intangible asset impairment
Picot Collective purchases a patent on January 1, 2015 for $ 118,800. At the time of purchase, Picot estimated that the patent had a useful life of 12 years. Picot used the straight-line method to amortize the patent, and annual impairment tests showed no impairment of the patent's value. On January 1, 2020, Picot sold the patent for $ 84,600.
Instructions
Prepare the journal entry to record the sale of the patent.

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Definitions:

Brightness Contrast

The difference in brightness between objects or parts of objects, which influences the perception of their visual appearance.

Lateral Inhibition

A process in the nervous system where an excited neuron reduces the activity of its neighbors, sharpening sensory perception.

Brightness Contrast

The difference in light intensity between two adjacent areas, making one appear brighter than the other.

Mach Bands

An optical illusion where the contrast at the edges of adjacent light and dark areas appears exaggerated.