Cullumber Company acquired a patent on an oil extraction technique on January 1,2020 for $7550000....
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Cullumber Company acquired a patent on an oil extraction technique on January 1,2020 for $7550000. It was expected to have a 10 year life and no residual value. Cullumber uses straight-line amortization for patents. On December 31,2021 , the future cash flows expected from the patent were $915000 per year for the next eight years. The present value of these cash flows, discounted at Cullumber's market interest rate, is $4225000. At what amount should the patent be carried on the December 31,2021 balance sheet? $7320000.$4225000$7550000$6040000
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