On January 1, 2017, Cullumber Company had a balance of
$386,500 of goodwill on its balance sheet that resulted from the
purchase of a small business in a prior year. The goodwill had an
indefinite life. During 2017, the company had the following
additional transactions.
Jan. 2 Purchased a patent (6-year life) $362,250.
July 1 Acquired a 9-year franchise; expiration date July 1,
2,026, $554,400.
Sept. 1 Research and development costs $185,500.
Prepare the necessary entries to record the transactions
related to intangibles. All costs incurred were for cash. (Record
entries in the order displayed in the problem statement. Credit
account titles are automatically indented when the amount is
entered. Do not indent manually. If no entry is required, select
"No Entry" for the account titles and enter 0 for the
amounts.)
Date
Account Titles and Explanation
Debit
Credit
choose a transaction date
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
choose a transaction date
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
choose a transaction date
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
eTextbook and Media
List of Accounts
Make an entry as of December 31, 2017, recording any necessary
amortization. (Round answers to 0 decimal places, e.g. 125. Credit
account titles are automatically indented when the amount is
entered. Do not indent manually. If no entry is required, select
"No Entry" for the account titles and enter 0 for the
amounts.)
Account Titles and Explanation
Debit
Credit
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
eTextbook and Media
List of Accounts
Indicate what the intangible asset account balances should be
on December 31, 2017.
Patent
$enter a dollar amount
Franchise
$enter a dollar amount