Exercise 9-11 These are selected 2017 transactions for Grouper Corporation: Prep
ID: 2508097 • Letter: E
Question
Exercise 9-11
These are selected 2017 transactions for Grouper Corporation:
Prepare all adjusting entries at December 31 to record amortization required by the events. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Date
Account Titles and Explanation
Debit
Credit
Dec. 31
(To record amortization of Copyrights)
Dec. 31
(To record amortization of Patents)
Dec. 31
(To record amortization of Goodwill)
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Jan. 1 Purchased a copyright for $142,800. The copyright has a useful life of 7 years and a remaining legal life of 33 years. Mar. 1 Purchased a patent with an estimated useful life of 6 years and a legal life of 21 years for $88,200. Sept. 1 Purchased a small company and recorded goodwill of $152,200. Its useful life is indefinite.Explanation / Answer
Date Account Debit credit DEC31 Amortisation expense 20400 Accumulated amortisation -copyright 20400 [being copyright amortised over its useful life142800/7] DEC31 Amortisation expense 12250 Accumulated amortisation - Patent 12250 being patent amortised88200/6]=14700 per year or [14700*10/12]= 12250 [1mar -31dec =10 months] Dec 31 Goodwill is not amortised as it has indefinite life
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