Reichenbach Co., 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 and 2021.

Instructions

Prepare the necessary entries to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles. Make the entries as of December 31, 2021, recording any necessary amortization and reflecting all balances accurately as of that date. (Ignore income tax effects.)

Intangible Assets 8-year franchise; expiration date 6/30/28 Advance payment on laboratory space (2-year lease) Net loss for 2020 including state incorporation fee, $1,000, and related legal fees of organizing, $5,000 (all fees incurred in 2020) Patent purchased (10-year life) Cost of developing a secret formula (indefinite life) Goodwill purchased (ndefinite life) Legal fee for successful defense of patent purchased above Research and development costs 7/1/20 10/1/20 $ 48,000 24,000 12/31/20 16,000 1/2/21 3/1/21 4/1/21 6/1/21 9/1/21 84,000 75,000 278,400 12,650 160,000