Prepare journal entries on books of Twilight Corporation

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Reference no: EM132999946

Question - Twilight Corporation purchased patents from other businesses. The first patent was purchased on March 1, 2021 for $65,500 and was expected to have a useful life ending December 31, 2023. The second patent was purchased on August 1, 2021 for $62,400 and was expected to have an indefinite useful life.

On January 1, 2022, Twilight determined that the second patent would no longer have an indefinite useful life, and in fact would have a useful life of another 7 years, beginning January 1, 2022.

On May 1, 2022, Twilight Corporation purchased a third patent for $8,775. This patent has an effective useful life ending December 31, 2023. Twilight Corporation has a December 31 year end and follows ASPE.

Prepare the journal entries on the books of Twilight Corporation to record each of the above transactions, including any year-end journal entries required for amortization.

Reference no: EM132999946

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