Suppose Murask paid $2.6 million for a patent related to an integrated system, including hands-free cell phone, GPS, and iPod connectivity. The company expects to install this system in its automobiles for ten years. Murask will sell this as an "extra" for $1,700. In the first year, 9,900 units were sold. All costs per unit totalled $830. n
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1. As the CFO, how would you record transactions relating to the patent in the first year? n
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2. Prepare the income statement for the integrated system's operations for the first year. Evaluate the profitability of the integrated system's operations. Use an income tax rate of 32%. n
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3. Explain what items were recorded as assets and why.n
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Answer rating: 100% (QA)

Answer 1 Transaction Event Account Titles Debit Credit 1 Patent 2600000 Cash 2600000 To rec... View the full answer