What is the proper way to account for this cost also record

Assignment Help Accounting Basics
Reference no: EM13566981

Margaret Avery Company from time to time embarks on a research program when a special project seems to offer possibilities. In 2011, the company expends $332,790 on a research project, but by the end of 2011 it is impossible to determine whether any benefit will be derived from it.

(a) The project is completed in 2012, and a successful patent is obtained. The R&D costs to complete the project are $132,480. The administrative and legal expenses incurred in obtaining patent number 472-1001-84 in 2012 total $33,900. The patent has an expected useful life of 5 years. Record these costs in journal entry form. Also, record patent amortization (full year) in 2012. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation Debit Credit
(To record research and development costs)

(To record legal and administrative costs)

(To record one year's amortization expense)

(b) In 2013, the company successfully defends the patent in extended litigation at a cost of $43,360, thereby extending the patent life to December 31, 2020. What is the proper way to account for this cost? Also, record patent amortization (full year) in 2013. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation Debit Credit
(To record legal cost of successfully defending patent)

(To record one year's amortization)

Reference no: EM13566981

Questions Cloud

Preferred stock xyz corporation issued at par for 50 per : preferred stock xyz corporation issued at par for 50 per share. if stockholders are promised an 8 annual dividend what
If the machine has no salvage value at the end of six : james company is considering buying a new machine costing 30000. james estimates that the machine will save 6900 per
Payback method lo3 assume a 200000 investment and the : payback method lo3 assume a 200000 investment and the following cash flows for two products year product x product y 1
Use the same facts as problem 1 above except assume that at : property plant and equipment 1. a company acquired a new high-tech printing press on january 1 2011 for 90000. at that
What is the proper way to account for this cost also record : margaret avery company from time to time embarks on a research program when a special project seems to offer
Paid back 10 of its long-term debt received 25000 for the : lobnitz service companys balance sheet as of 01-01-11 is presented below 01-01-11 current assets cash 400000 accounts
Prepare a reconciliation schedule to reconcile 2011 net : s. a. harrington company is a u.s.-based company that prepares its consoli- dated financial statements in accordance
How does the western model of education as part of a larger : in this course weve considered the argument that it is difficult if not impossible to be a passive participant in any
Tis delivery service is expected to generate net cash : apnea video rental store is considering the purchase of an almost new minivan to use as a vehicle to deliver and pick

Reviews

Write a Review

Accounting Basics Questions & Answers

  Method of accounting for uncollectible accounts

What is the method of accounting for uncollectible accounts that is required when bad debts are significant in size?

  Question regarding increased productivity

A company that makes shopping carts for supermarkets and other stores recently purchased some new equipment that reduces the labor content of the jobs needed to produce the shopping carts.

  Amounts of adjustment determined

Based on this information, what type of adjusting entries does Ritz manor have? how are amounts of these adjustment determined? Which accouts are affected?

  Knowledge of accounting concepts-terminology

Why is a knowledge of accounting concepts and terminology useful to anyone in a business activity?

  Payments of accrued interest and principal

On January 1, 2009, American Eagle borrows $65,000 cash by signing a four-year, 8% installment note. The note requires four equal total payments of accrued interest and principal on December 31 of each year from 2009 through 2012.

  Amount allocated to cost of goods sold

Using the FIFO inventory method, the amount allocated to COST OF GOODS SOLD for July is ??

  Up to how much would the company be willing to pay for one

nbspcrane company makes four products in a single facility. data concerning these products appear belowproductnbspnbsp

  Choose a management function planning directing and

select a management function planning directing and motivating or controlling and explain how that function relates to

  Computing-journalizing payroll transactions

Record the payroll for the two employees at December 31 and record the employer's share of payroll tax expense for the December 31 payroll. Two journal entries required.

  Expenditure cycles

For the expenditure cycle at Hewlett-Packard or any other company, what's your suggestion for the following recommendations to have good internal control of the purchase order processing?

  Cost of land under cost principle

A company purchased land for $80,000 cash. Real estate brokers' commission was $5,000 and $7,000 was spent for demolishing an old building on the land before construction of a new building could start. Under the cost principle, the cost of land wo..

  Tax laws and regulations

Prepare a memo for your firm's client files describing the results of your research, including tax laws and regulations.

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!

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