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Bas_tet [7]
3 years ago
12

In January 2021, Vega Corporation purchased a patent at a cost of $200,000. Legal and filing fees of $50,000 were paid to acquir

e the patent. The company estimated a 10-year useful life for the patent and uses the straight-line amortization method for all intangible assets. In January 2024, Vega spent $40,000 in legal fees for an unsuccessful defense of the patent and the patent is no longer usable. The amount charged to income (expense and loss) in 2024 related to the patent should be:_________
a. $40,000.
b. $65,000.
c. $215,000.
d. $25,000.
Business
1 answer:
ale4655 [162]3 years ago
6 0

Answer:

c. $215,000

Explanation:

The computation of the amount charged to income is shown below:

But before that first we have to determine the book value as on Jan 2024 which is

Total patent cost

= $200,000 + $50,000

= $250,000

Amortized cost till year 2024 is

= ($250,000 ÷ 10 years) × 3 years

= $75,000

The three years is counted from 2021 to 2024

Now

Book value on Jan 2024 is

= $250,000 - $75,000

= $175,000

So,

Amount charged to income  is

= $175,000 + $40,000

= $215,000

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3 0
3 years ago
Bretthauer Corporation has provided data concerning the Corporation's Manufacturing Overhead account for the month of July. Prio
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Answer:

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3 years ago
Lauren is the owner of a bakery. Last year, her total revenue was $145,000, her rent was $12,000, her labor costs were $65,000,
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<h3>What is a Statutory broker?</h3><h3 />

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