Potent. The oompeny purcesed ? poentata G88h cost of $58,500 on January 1, 2017.

Question

Potent. The oompeny purcesed ? poentata G88h cost of $58,500 on January 1, 2017. The petent has ?" estmeted useul ife of 13 yers. b. Copyright. On c Franchise The compeny o ter ed ? franche e torm tocenna Company to make and dist ute 5?eo al nem, lt ootsi ed te fanchee on January 1 2017 et cash ocet of $14,000 ora 10-year penod. d. Licon". On January 1, 2016, n company secured aloense tam te cty ??ap noe apeial genoe for period of nve ye . Total cash ? pended to obtain te leeree maa $14,200. January 1. 2D17, te compar y purraaed ? oooyright for 523 500 oash. It ia estraad that the “pr grid tam wi nag MO value by t 00nd of 10 years. e an ndefnite Ife oodwill. The oor eny started busne53 in Jenuary 2014 by pur h 5ng another busne53 ora c55h mp m of $420 000 Included n te p th55e p ce s oodwil, S42 0 Comper y e ea t es B ted t at the good i an mpo nt 1 lved asset oo us." t h55 ??? de mel e Raquirad: 1. Compute the aront of amortzaton that should be recorded for each intang bise t the end of the arnual accouning paricd,Ccmber 31,2017 2. Determine the book value of eaech intangible asset on December 31. 2010 any, of the impairment loss to be recorded

Explanation / Answer

1 Amortization a. Patent 58500/13 4500 b. Copyright 23500/10 2350 c. Franchise 14600/10 1460 d. License 14200/5 2840 e. Goodwill 0 (It cant be amortized) 2 Book value Purchase Price Amortization Book Value a. Patent 58500 9000 49500 (4500*2) b. Copyright 23500 4700 18800 (2350*2) c. Franchise 14600 2920 11680 (1460*2) d. License 14200 8520 5680 (2840*3) e. Goodwill 42000 0 42000 3 Impairment loss=17600-16800=$ 800

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