Question: On March 31 2009 Lincoln Med Co acquired an existing

On March 31, 2009, Lincoln Med Co acquired an existing patent to produce a pain reliever from Jefferson Pharma ceuticals for $1,871,800. The patent offers exclusive rights to produce this medication for another seven years. Lincoln’s fiscal year ends on December 31.
(a) What journal entry is made on March 31, 2009, to record the purchase of the patent?
(b) What will be the salvage value of this patent after seven years? Explain the rationale for your answer.
(c) What amount of amortization should be taken in 2009, 2010, and 2016?
(d) Prepare the December 31, 2009, journal entry related to this patent.

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