User Account

All Pages

Make adjusting and correcting journal entries on December

Assignment Help Accounting Basics
Reference no: EM132887442

Problem - Correcting Entries for Patents During the year-end audit of Cressman Corporation's financial statements for 2019, you discover the following items:

1. Cressman capitalized $57,000 to the Patent account at the beginning of 2018 for the cost of a patent. This amount included $50,000 of R&D costs. The patent was amortized over a 20-year life in 2018 and 2019.

2. At the beginning of 2018, Cressman paid its lawyers $8,000 to successfully defend a patent infringement suit regarding the patent in Item 1. Cressman debited this cost to Legal Fees Expense.

3. At the beginning of 2019, Cressman purchased a patent for $30,000 from Baylor Company to prevent potential competition. It recorded the cost in the Patent account and amortized this cost over the remaining legal life of the patent obtained in Item 1 (19 years). However, Cressman agreed to a suggestion by the auditors that the life of the original patent obtained in Item 1 was protected for only 7 more years as of the beginning of 2019.

Required - Make adjusting and correcting journal entries on December 31 for 2019.

Reference no: EM132887442

Questions Cloud

Explain the purpose of financial statement analysis : Identify benefit and drawback (cost) to allowing managerial discretion within GAAP reporting requirements. Explain the purpose of Financial Statement Analysis
Explain the danger of evidence degradation : Explain the danger of the evidence degradation due to the environment. Describe the instrumentation at the lab that might be used to examine the evidence.
Identify two components of the control environment : Question 1 Identify two good personnel policies or practices and explain how each strengthens internal control.
What does net income mean on the income statement : What does net income mean on the income statement? After your course, you will be able to understand and evaluate financial statements.
Make adjusting and correcting journal entries on December : Cressman capitalized $57,000 to the Patent account at the beginning of 2018 for the cost of a patent. Make adjusting and correcting journal entries on December
Why domestic inquiry is important to be done : Why domestic inquiry is important to be done before imposing any penalty?
What is the interest payment estimated for april : What is the interest payment estimated for April (there is no bank loan outstanding at the end of March)? (Do not round intermediate calculations.)
Prepare journal entries to record the preceding transactions : Sold a trade name for $50,000. The trade name had a carrying value of $5,000. Prepare journal entries to record the preceding transactions
What is a good response to the situation : What would you do if your manager asks you to help out the kitchen because one of the kitchen staff called in sick? The restaurant is very busy and you know tha

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd