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mylen [45]
3 years ago
8

Smitty Museum purchased the copyright to a piece of artwork for $925,000. Smitty plans to reproduce 2.1 million posters of the a

rtwork over a period of 9 years. Calculate the amortization for the year assuming the Museum plans to reproduce and sell 133,000 posters the first year year
Business
1 answer:
Harman [31]3 years ago
8 0

Answer:

amoritzation expense 3,268

           copyright                       3,268

Explanation:

We will divide the acquisition cost by the total units of production:

925,000 / 2,100,000 = 0.024571429  this would be the rate per poster

<u>Then we multiply by this year level:</u>

(it is convinient to do all in a single step if using a calculator to avoid any rounding error)

133,000 x 925,000 / 2,100,000 = $3,268.00

amoritzation expense 3,268

           copyright                       3,268

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Opting for other structures will either focus on applications or sales. But, it will be ineffective as sales will not happen without applications and applications alone cannot generate good sales without proper marketing.

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The overview of the instance would be described throughout the following section.

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