Question

Exercise 12-06 Blossom Company, organized in 2019, has set up a single account for all intangible...

Exercise 12-06

Blossom Company, organized in 2019, has set up a single account for all intangible assets. The following summary discloses the debit entries that have been recorded during 2020.
1/2/20 Purchased patent (8-year life)

$352,800

4/1/20 Purchase goodwill (indefinite life)

351,000

7/1/20 Purchased franchise with 10-year life; expiration date 7/1/30

431,000

8/1/20 Payment of copyright (5-year life)

157,200

9/1/20 Research and development costs

221,000

$1,513,000

Prepare the necessary entry to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles. (Credit account titles are automatically indented when 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
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

SHOW LIST OF ACCOUNTS

LINK TO TEXT

LINK TO TEXT

LINK TO TEXT

Make the entry as of December 31, 2020, recording any necessary amortization. (Credit account titles are automatically indented when 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
enter an account title enter a debit amount enter a credit amount

SHOW LIST OF ACCOUNTS

LINK TO TEXT

LINK TO TEXT

LINK TO TEXT

Reflect all balances accurately as of December 31, 2020.
Use straight-line amortization
select an intangible asset

PatentsGoodwillCopyrightsFranchisesResearch and development costs

$enter a dollar amount
select an intangible asset

PatentsCopyrightsFranchisesResearch and development costsGoodwill

$enter a dollar amount
select an intangible asset

CopyrightsFranchisesGoodwillResearch and development costsPatents

$enter a dollar amount
select an intangible asset

GoodwillPatentsFranchisesCopyrightsResearch and development costs

$enter a dollar amount

Homework Answers

Answer #1
1
Account Titles and Explanation Debit Credit
Patents 352800
Goodwill 351000
Franchises 431000
Copyrights 157200
Research and Development Expense 221000
         Intangible Assets 1513000
2
Account Titles and Explanation Debit Credit
Amortization Expense 78750
      Patents 44100 =352800/8
      Franchise 21550 =431000/10*6/12
      Copyright 13100 =157200/5*5/12
3
Use straight-line amortization
Patents 308700 =352800-44100
Goodwill 351000
Franchise 409450 =431000-21550
Copyright 144100 =157200-13100
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