C & T Company Purchased a Company That Produced Bottled

question 113

Short Answer

C & T Company purchased a company that produced bottled water with fruit juice additives. The brand name for these products, Fruit Options, was well known and had a well-established customer base. At the time of purchase, January 2 of the current year, C & T valued this brand name at
$250,000. The life of this intangible asset cannot be determined. However, it was assessed at the end of the year at the purchase price. The patent for the unique processing of the fruit juices had a remaining life of 8 years and an amount of $4,800 was recorded on the books for it. Prepare the journal entries for the amortization of these items at C & T's year end, June 30.