Oriole Co., organized in 2016, has set up a single account for all intangible as

Question

Oriole Co., organized in 2016, has set up a single account for all intangible assets. The following summary discloses the debit entries that have been recorded during 2017 and 2018.

Intangible Assets

1) Prepare the necessary entries to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles. Make the entries as of December 31, 2018, recording any necessary amortization. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round all answers to 0 decimal places, e.g. 8,564. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

2) Reflecting all balances accurately as of that date. (Ignore income tax effects.)

A) Franchises

B) Goodwill

C) Prepaid Rent

D) Patents

Your answer is partially correct. Try again.

Explanation / Answer

Answer (1)

Journal Entries

Solution 2

Franchise = ($50408 - $9450) = $40950

goodwill = $276800

prepaide rent = ($24000 - $15000) = $9000

patents = ($93960 - $8273) = $85687

Particulars Debit Credit Franchisee $50400 Prepaid Rent $24000 Retained Earnings $14800 Patents ($82000 + $11960) $93960 Research and development expenses ($79000 + $148000) $227000 Goodwill $276800 Intangible assets $689960 (Being Intangibles assets segregated) Amortisation expenses ($50400/8 year) $6300 Retained earnings ($50400/8 year)*6 month/12 $3150 Franchisee $9450 (Amortisation recorded on franchisee)

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