MILESTONE IV:$$

PART I. Intangible Assets, Amortization under GAAP $[$Learning Objectives $6,7]$

Hein Technologies conducted the following cash transactions on January $1.$

Paid $$712,000$ to fund internal research designed to develop a new digital scanner. The company expects the useful life to be $3$ years.

Patented a product based on internal research that could be sold to consumers. Before applying for the patent, incurred additional costs of $$200,000$ to complete product development ensuring that the product was technologically feasible. Paid $$13,800$ for patent filing costs and legal fees to successfully defend the patent. The company expects the new technology will be profitable for a $3-$year period.

Leased three floors of office space. The lease was secured by making an advance payment of $$300,000.$ The lease is a $10-$year lease with no renewal options.

Paid $$560,000$ to renovate the leased property to prepare the leased floors for intended use. The useful life of the renovations is estimated at $10$ years.

Paid $$45,000$ to acquire a franchise to distribute ICC external hard drives for a $9-$year period.

DELIVERABLE

A$.$ Assume that Hein acquired Dolan Development last year. Hein recorded the following intangible assets on the date of acquisition:

Goodwill, $$1,500,000$

Dolan Development trademark, $$600,000$

Renewable licenses, $$56,000$

Prepare the year$-$end adjusting entries required for each of Hein$$s intangible assets. Assume that the straight$-$line method is used and a full year$$s amortization is taken in the year of acquisition.

USE the charts in the images