Answer:
The patent should be reported at $302,400 on the December 31, 2020, balance sheet.
Explanation:
Remaining useful life in month of patent on January 1, 2020 = 8 * 12 = 96 months
Remaining useful life in month of patent on December 1, 2020 = 96 - 11 = 85 months
Amortization of book value of patent in 2020 = (Patent Book value / Remaining useful life in month of patent on January 1, 2020) * 12 = ($201,600 / 96) * 12 = $25,200
Amortization of legal cost in 2020 = (Legal cost / Remaining useful life in month of patent on December 1,, 2020) * 1 = ($127,500 / 85) * 1 = $1,500
Carrying amount of patent = Patent Book value + Legal cost = $201,600 + $127,500 = $329,100
Patent book value on December 31, 2020 = Carrying amount of patent - Amortization of book value of patent in 2020 - Amortization of legal cost in 2020 = $329,100 - $25,200 - $1,500 = $302,400
Therefore, the patent should be reported at $302,400 on the December 31, 2020, balance sheet.
