Exercise 12-9 (Part Level Submission) During 2013, Riverbed Corporation spent $1
ID: 2524060 • Letter: E
Question
Exercise 12-9 (Part Level Submission)
During 2013, Riverbed Corporation spent $162,720 in research and development costs. As a result, a new product called the New Age Piano was patented. The patent was obtained on October 1, 2013, and had a legal life of 20 years and a useful life of 10 years. Legal costs of $36,720 related to the patent were incurred as of October 1, 2013.
(a)
Date
Account Titles and Explanation
Debit
Credit
2013
2013
2013
2014
Exercise 12-9 (Part Level Submission)
During 2013, Riverbed Corporation spent $162,720 in research and development costs. As a result, a new product called the New Age Piano was patented. The patent was obtained on October 1, 2013, and had a legal life of 20 years and a useful life of 10 years. Legal costs of $36,720 related to the patent were incurred as of October 1, 2013.
Explanation / Answer
Date Account Titles and Explanation Debit Credit 2013 Resaerch and development expense $162,720 Cash $162,720 (To record research and development expenses 2013 Patents $36,720 Cash $36,720 (To record legal expenses) 2013 Patent amortization expense $918 Patents ($36,720 / 10 x 3/12) $918 (To record amortization expense) 2014 Patent amortization expense $3,672 Patents ($36,720 / 10) $3,672
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