Reference no: EM132054291

Question - Fields Laboratories holds a valuable patent (No. 758-6002-1A) on a precipitator that prevents certain types of air pollution. Fields does not manufacture or sell the products and processes it develops. Instead, it conducts research and develops products and processes which it patents, and then assigns the patents to manufacturers on a royalty basis. Occasionally it sells a patent. The history of Fields patent number 758-6002-1A is as follows.

Date	Activity	Cost
2005-2006	Research conducted to develop precipitator	$382,750
Jan. 2007	Design and construction of a prototype	85,160
March 2007	Testing of models	69,160
Jan. 2008	Fees paid engineers and lawyers to prepare patent
	application; patent granted June 30, 2008	87,380
Nov. 2009	Engineering activity necessary to advance the design
	of the precipitator to the manufacturing stage	80,790
Dec. 2010	Legal fees paid to successfully defend precipitator patent	69,160
April 2011	Research aimed at modifying the design of the
	patented precipitator	70,640
July 2015	Legal fees paid in unsuccessful patent infringement suit
	against a competitor	60,730

Fields assumed a useful life of 17 years when it received the initial precipitator patent. On January 1, 2013, it revised its useful life estimate downward to 5 remaining years. Amortization is computed for a full year if the cost is incurred prior to July 1, and no amortization for the year if the cost is incurred after June 30. The company's year ends December 31.

Compute the carrying value of patent No. 758-6002-1A on each of the following dates:

(a) December 31, 2008

(b) December 31, 2012

(c) December 31, 2015