On January 2, 2017, Fran Acquires a Business from Chuck

question 38

Multiple Choice

On January 2, 2017, Fran acquires a business from Chuck. Among the assets purchased are the following intangibles: patent with a 7-year remaining life, a covenant not to compete for 10 years, and goodwill. ​
Of the purchase price, $140,000 was paid for the patent and $60,000 for the covenant. The amount of the excess of the purchase price over the identifiable assets was $100,000. What is the amount of the amortization deduction for 2017?

• A)$10,667.
• B)$16,000.
• C)$20,000.
• D)$32,667.
• E)None of the above.

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Definitions:

16th-Century Codex

A manuscript book from the 16th century, often elaborately decorated and containing historical, religious, or scientific texts.

Folio

A page of a manuscript or book.

Market Wage

The prevailing wage rate in a labor market, determined by supply and demand for labor.

Entry Level

In the job market, entry-level refers to positions that are designed for individuals with no or minimal professional experience, often requiring lower qualifications and providing training on the job.