80.2K

Verified Solution

Link Copied!

Section Medium Question Answe THREE Questions (3 x 7 mars 21 marks) 06- Financial Statement. The intangible assets section of Omar Company at December 31, 2020, is presented below Patents($110,000 cost less $11,000 amortization) 599,000 Franchises (575.000 cost less $37.500 ansortization) 37,500 Total $136,500 2 The patent was acquired in January 2020 and has a useful life of 10 years. The franchise was acquired in January 2015 and also has a useful life of 10 years. The following cash transactions may have affected intangible assets during 2021 Jan 2 Paid $72,000 legal costs to successfully defend the patent against infringement by another company Jan-June Developed a new product, incurring $250,000 in research and development costs. A patent was granted for the product on July 1.IS useful life is equal to its legal life. Paid S125,000 to an Xgames star to appear in commercials advertising the company's products. The commercials will air in September and October Acquired a franchise for $150,000. The franchise has a useful life of 30 years. Sept Instructions a. Prepare journal entries to record the transactions above (h. Prepare joumal entries to record the 2021 amortization expense (ck Prepare the intangible assets section of the balance sheet at December 31, 2021

Answer & Explanation Solved by verified expert

See Answer