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$51,510 $202,960 91,400 244,100 107,060 $447,060 40,540 74,980 70,090 11,480 $44

ID: 2720200 • Letter: #

Question

$51,510

$202,960

91,400

244,100

107,060

$447,060

40,540

74,980

70,090

11,480

$447,060

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Account Titles and Explanation

Debit

Credit

Account Titles and Explanation

Debit

Credit

??

On July 1, 2014, Brigham Corporation purchased Young Company by paying $251,160 cash and issuing a $151,710 note payable to Steve Young. At July 1, 2014, the balance sheet of Young Company was as follows.
Cash

$51,510

Accounts payable

$202,960

Accounts receivable

91,400

Stockholders’ equity

244,100

Inventory

107,060

$447,060

Land

40,540

Buildings (net)

74,980

Equipment (net)

70,090

Trademarks

11,480

$447,060


The recorded amounts all approximate current values except for land (fair value of $80,730), inventory (fair value of $127,130), and trademarks (fair value of $17,560).

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Explanation / Answer

**Amortization expense = (17560 - 4800 )/4

                                           = 12760 /4

                                        = $ 3190 per year

Amortization for 2014 = 3190 * 6/12                    [1july -31dec]

                                     = 1595            

Title Debit credit Amortization expense 1595 Accumulated Amortization /Trademark (If accumulated amortization account is not maintained) 1595 [being amortization expense recorded]