Pharoah Co., organized in 2017, provided you with the following information. 1.Purchased a license for $28,800 on
Question:
Pharoah Co., organized in 2017, provided you with the following information.
1.Purchased a license for $28,800 on July 1, 2017. The license gives Pharoah exclusive rights to sell its services in the tri-state region and will expire on July 1, 2025.
2.Purchased a patent on January 2, 2018, for $82,200. It is estimated to have a 5-year life.
3.Costs incurred to develop an exclusive Internet connection process as of June 1, 2018, were $86,600. The process has an indefinite life.
4.On April 1, 2018, Pharoah Co. purchased a diode manufacturer for $698,600. Goodwill recorded in the transaction was $119,800.
5.On July 1, 2018, legal fees for successful defense of the patent purchased on January 2, 2018, were $15,300.
6.Research and development costs incurred as of September 1, 2018, were $86,600.
Prepare the journal entries to record all the entries related to the patent during 2018.
Intermediate Accounting
ISBN: 978-0132162302
1st edition
Authors: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella