Reference no: EM132612975

Residual value

Accumulated depreciation / impairment to December 31, 20X3

Net book value, at December 31, 20X3

Life (in yrs) Cost Residual value impairment dec 31, 20X3 nbv @ 12/31/20X3

Patent15 75,000     0        40,278           34,722

Reported at its net amount of $34,722 on the statement of financial position

• SBC paid $75,000 to acquire a patent in 20X1. In 20X3 SBC wrote down the value of its patent $30,000 as it its value was judged to be impaired due to a competitor's copying of the design. During 20X4, SBC spent $13,000 successfully defending its patent. In light of the successful patent defence, SBC now estimates that both the fair value of the patent and its value in use are $69,000. Estimated costs of disposal are $2,000.

Question 1: Journal entries to account for this year end December 31, 20X4