K. No amortization has been recorded for Bust-A-Move Snowboard's intangible assets. Goodwill was acquired through Bust-A-Move...

  
 

   

 

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K. No amortization has been recorded for Bust-A-Move Snowboard's intangible assets. Goodwill was acquired through Bust-A-Move Snowboard's purchase of TJX Shoppe in 2010. The Company has made the election prospectively in the current year to amortize per the PCC guidance. No impairment has been noted. L. The patent was acquired in 2018 after years of research and development. Legal fees for the patent were $15,500 on January 1, 2018. On that date patent was deemed to have a useful life of 5 years. On December 1, 2018 Bust-a-Move Snowboard, Inc. successfully defended its patent from Burton Snowboards. The costs incurred amounted to $15,000. This transaction has not yet been recorded and has extended the useful life of the patent for 8 years from the date of defense. Any costs incurred were paid in cash. Bust-a-Move Snowboard has asked you to make the following adjusting journal entries to record the following transactions (A-O): Account Title Cash Accounts Receivable Allowance for Doubtful accounts Inventory Prepaid Rent Supplies Land Building Equipment Accumulated Depreciation, Building Accumulated Depreciation, Equipment Goodwill Patent Accounts Payable Notes Payable Trial Balance December 31, 2018 Uneamed Service Revenue Common Stock Retained Earnings Revenue Salary Expense Cost of Goods Sold Advertising Expense Rent Expense Miscellaneous Expense $ SSSSSS SS $ SSSSSS Debit 124,000 96,000 54.115 24,000 6,000 48,000 250,000 75,000 35,500 15,500 SS $ $ $ $ $ $ SS Credit 2,400 50,000 21,000 132,715 178,000 122,000 96,000 126,000 688,000 440,000 201,000 15,000 32,000 1,000 1.417.115 S 1.417.115 Account Title Cash Accounts Receivable Allowance for Doubtful accounts Trial Balance December 31, 2018 Inventory Prepaid Rent Supplies Land Building Equipment Accumulated Depreciation, Building Accumulated Depreciation, Equipment Goodwill Patent Accounts Payable Notes Payable Uneamed Service Revenue Common Stock Retained Earnings Revenue Salary Expense Cost of Goods Sold Advertising Expense Rent Expense Miscellaneous Expense S5 SSSSSS $ $ SS $ SSSSSS $ $ Debit 124,000 96.000 54.115 24,000 6,000 48,000 250,000 75,000 35,500 15,500 440.000 201,000 $ 2,400 SS $ $ $ $ $ Credit S 50,000 21,000 132,715 178,000 122,000 96,000 126.000 688,000 15,000 32,000 1,000 1.417.115 S 1.417.115 ce! You have just received a second interview with Bust-a- Move Snowboard, Incorporated. The pay is fantastic at $25/ hour. Before they make you a job offer, they invite you in to participate in their year-end close process. They have invited 6 college students to participate in the process. The competition is fierce. The applicant who completes their financial statements without error will be awarded the job. K. No amortization has been recorded for Bust-A-Move Snowboard's intangible assets. Goodwill was acquired through Bust-A-Move Snowboard's purchase of TJX Shoppe in 2010. The Company has made the election prospectively in the current year to amortize per the PCC guidance. No impairment has been noted. L. The patent was acquired in 2018 after years of research and development. Legal fees for the patent were $15,500 on January 1, 2018. On that date patent was deemed to have a useful life of 5 years. On December 1, 2018 Bust-a-Move Snowboard, Inc. successfully defended its patent from Burton Snowboards. The costs incurred amounted to $15,000. This transaction has not yet been recorded and has extended the useful life of the patent for 8 years from the date of defense. Any costs incurred were paid in cash. Bust-a-Move Snowboard has asked you to make the following adjusting journal entries to record the following transactions (A-O): Account Title Cash Accounts Receivable Allowance for Doubtful accounts Inventory Prepaid Rent Supplies Land Building Equipment Accumulated Depreciation, Building Accumulated Depreciation, Equipment Goodwill Patent Accounts Payable Notes Payable Trial Balance December 31, 2018 Uneamed Service Revenue Common Stock Retained Earnings Revenue Salary Expense Cost of Goods Sold Advertising Expense Rent Expense Miscellaneous Expense $ SSSSSS SS $ SSSSSS Debit 124,000 96,000 54.115 24,000 6,000 48,000 250,000 75,000 35,500 15,500 SS $ $ $ $ $ $ SS Credit 2,400 50,000 21,000 132,715 178,000 122,000 96,000 126,000 688,000 440,000 201,000 15,000 32,000 1,000 1.417.115 S 1.417.115 Account Title Cash Accounts Receivable Allowance for Doubtful accounts Trial Balance December 31, 2018 Inventory Prepaid Rent Supplies Land Building Equipment Accumulated Depreciation, Building Accumulated Depreciation, Equipment Goodwill Patent Accounts Payable Notes Payable Uneamed Service Revenue Common Stock Retained Earnings Revenue Salary Expense Cost of Goods Sold Advertising Expense Rent Expense Miscellaneous Expense S5 SSSSSS $ $ SS $ SSSSSS $ $ Debit 124,000 96.000 54.115 24,000 6,000 48,000 250,000 75,000 35,500 15,500 440.000 201,000 $ 2,400 SS $ $ $ $ $ Credit S 50,000 21,000 132,715 178,000 122,000 96,000 126.000 688,000 15,000 32,000 1,000 1.417.115 S 1.417.115 ce! You have just received a second interview with Bust-a- Move Snowboard, Incorporated. The pay is fantastic at $25/ hour. Before they make you a job offer, they invite you in to participate in their year-end close process. They have invited 6 college students to participate in the process. The competition is fierce. The applicant who completes their financial statements without error will be awarded the job.

Answer rating: 100% (QA)

The adjustment entry for goodwill amortization will be made as follows Goodw... View the full answer