Culver Corporation purchases a patent from Sunland Company on January 1, 2020, for $78,000. The...
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Culver Corporation purchases a patent from Sunland Company on January 1, 2020, for $78,000. The patent has a remaining legal life of 16 years. Culver feels the patent will be useful for 10 years. Assume that at January 1, 2022, the carrying amount of the patent on Culvers books is $62,400. In January, Culver spends $25,600 successfully defending a patent suit. Culver still feels the patent will be useful until the end of 2029. Prepare the journal entries to record the $25,600 expenditure and 2022 amortization. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Account Titles and Explanation
Debit
Credit
enter an account title to record expenditure of patents
enter a debit amount
enter a credit amount
enter an account title to record expenditure of patents
enter a debit amount
enter a credit amount
(To record expenditure of patents)
enter an account title to record amortization expense
enter a debit amount
enter a credit amount
enter an account title to record amortization expense
enter a debit amount
enter a credit amount
(To record amortization expense)
Answer & Explanation
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