Exercise 7-11 These are selected 2017 transections for Ayayai Corporation: Jan.

Question

Exercise 7-11 These are selected 2017 transections for Ayayai Corporation: Jan. 1 Purchased a copyright for $191,400. The copyright has a useful life of 6 years and a remaining legal life of 34 years. Mar. 1 Purchased a patent with an estimated useful life of 4 years end a legal life of 22 years for $60,720. Sept. 1 Purchased a small company and recorded goodwill of $152,700. Its usefull life is indefinite. Indicate the amount of amortization expense on December 31, 2017, for Ayayai Corporetion Amortization expense

Explanation / Answer

Amortization expense for Copyright = $191,400 / 6 = $31,900

Amortization expense for Patent = ($60,720 / 4) x (10/12) = $12,650

Amortization Expense on December 31, 2017 = $31,900 + $12,650 = $44,550

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