As the recently appointed auditor for Ng Ltd., you have been asked to examine selected accounts before the 6-month financial statements of June 30, 2019, are prepared. The controller for Ng mentions that only one account is kept for intangible assets.

Instructions
Prepare the entry or entries necessary to correct this account. Assume that the patent has a useful life of 12 years.

Transcribed Image Text:

Intangible Assets Debit Balance Credit Research and development costs (prior to achieving economic Jan. 4 viability) Legal costs to obtain patent Jan. 31 Payment of 7 months rent on property leased by Ng Feb. 11 Share premium on ordinary shares March HK$940,000 HK$ 940,000 1,015,000 1,106,000 856,000 Jan. 5 75,000 91,000 HK$250,000 Unamortized bond discount on bonds due March 31, 2039 84,000 940,000 31 business 1,147,000 1,288,000 April 30 Prom nal expenses related to start-up 207,000 June 30 Operating losses for first 6 months 141,000