On January 2, 2012, Fran Acquires a Business from Chuck

question 12

Multiple Choice

On January 2, 2012, 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 2012?

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

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Definitions:

Median

The value separating the higher half from the lower half of a data sample, a population, or a probability distribution.

Percentiles

Measures that divide a data set into 100 equal parts, indicating the percentage of data below a certain value.

Quintiles

A statistical measure that divides a population or dataset into five equal groups or parts, according to a particular variable.

Deciles

Divisions of a dataset into ten equal parts, where each part represents 10% of the data’s distribution.