How do prepare the journal entries in the books of flavours

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Reference no: EM132644024

During October 2018, Flavours Limited patented a new product at a cost of R240 000. On the 2nd January 2019, the company received a letter from DaWinners & Co for an amount of R25 000 in legal costs. These costs relate to legal fees incurred in acquiring the patent. The patent had a ten-year legal life. In June 2020, Flavours Limited incurred a further R10 000 in legal fees to successfully defend its patent rights. Flavours Limited year end is 31 December.

Required:

Problem 1: Prepare the journal entries in the books of Flavours Limited for the years ending 2018, 2019 and 2020 relating to the patent transactions.

Reference no: EM132644024

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