Questian B $(15$ marks$)$

On July $(2017,$ Cavaliers Corp, purchased a patent from a third$-$party, Nets Ine, for $$60,000.$ On fuly $1,2020,$

Cavaliens pad $$12,000$ for successfhl litigation in defending the patest. Cavaliers catimates that the useful life

of the patent will be $15$ years from the date of acquisition and choose to credit the patent accounr immediately

for the quantity of the smertization.

Instructions

a$)$ Prepare a calculation of the carrying value of the notent an December $11,2020.$ Label and show ail

calculations. $(12$ marks$)$

b$)$ Prepare the joumnt entry to recond the sale, assumine Caviliers sold the patent on January $1.2021,$ for a

net proceed of $5100,000$