The total amount of patent cost amortized to date is usually
shown in a separate Accumulated Patent Amortization account, which is shown contra to the Patent account. shown in the current income statement. reflected as credits in the Patent account. reflected as a contra property, plant, and equipment item.Which of the following is often reported as an extraordinary item? Amortization expense Impairment losses for intangible assets Research and development costs None of the aboveMini Corp. acquires a patent from Maxi Co. in exchange for 2,500 shares of Mini Corp.’s $5 par value common stock and $75,000 cash. When the patent was initially issued to Maxi Co., Mini Corp.’s stock was selling at $7.50 per share. When Mini Corp. acquired the patent, its stock was selling for $9 a share. Mini Corp. should record the patent at what amount? $87,500 $93,750 $97,500 $75,000A company acquires a patent for a drug with a remaining legal and useful life of 6 years on January 1, 2009 for $1,800,000. The company uses straight-line amortization for patents. On January 2, 2011, a new patent is received for a timed-release version of the same drug. The new patent has a legal and useful life of 20 years. The least amount of amortization that could be recorded in 2011 is
$300,000. $60,000. $81,818. $69,000.During 2011, Bond Company purchased the net assets of May Corporation for $1,000,000. On the date of the transaction, May had $300,000 of liabilities. The fair value of May’s assets when acquired was $1,500,000. How should the $500,000 difference between the fair value of the net assets acquired ($1,500,000) and the cost ($1,000,000) be accounted for by Bond? The $500,000 difference should be credited to retained earnings. The $500,000 difference should be recognized as a gain. The current assets should be recorded at $540,000 and the noncurrent assets should be recorded at $760,000. Type A deferred credit of $500,000 should be set up and then amortized to income over a period not to exceed 40 years. Loading ...
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