Dragon Fruit Trading spent P1,440,000 in acquiring a patent on January 3, 2012. Due to the competitive nature of the product, the patent was estimated to have a useful life of 10 years. At the beginning of 2016, the company paid P180,000 for legal fees in a successful defense of the patent. On July 1, 2020, a competitor obtained rights to a patent which made Dragon Fruit's patent obsolete. How much is the loss from the patent obsolescence? * O P216,000 O P243,000 O P261,000 P396,000 answer not given
Q: Pina Colada Industries Ltd. had one patent recorded on its books as at January 1, 2020. This patent…
A: As per IAS 38, Intangible Asset Only cost incurred in respect of development phase are to be…
Q: Belkin Plc purchased a patent for $135,000 on September 1, 2016. It had a useful life of 10 years.…
A: First, compute the carrying value of patent on January 1, 2018 and then add the cost of defending…
Q: During 2017, Lyle company incurred P400,000 of research and development costs in its laboratory to…
A: Above mentioned patent meets the recognition criteria of intangible assets , it is a self generated…
Q: In May 2020, West Company filed suit against brown Inc. seeking P850, 000 damages for patent…
A: Lets understand the meaning of contingent asset. Definition of contingent asset contain in the IAS…
Q: Nieland Industries had one patent recorded on its books as of January 1, 2017. This patent had a…
A: Workings: Given values; Book value of patent as of January 01, 2017 = $ 288000 Useful life = 8…
Q: On January 2, 2018, David Corporation purchased a patent for $500,000. The remaining legal life is…
A:
Q: During 2017 Holy land Corporation spent $150,000 in research costs. As a result a new product was…
A: In accordance with IFRS 38 "Intangible Assets", Any costs which are incurred to defend a patent will…
Q: Kingbird had one patent recorded on its books as of January 1, 2017. This patent had a book value of…
A: The question is based on the concept of Financial Accounting.
Q: On January 2, 2021, Dopey Enterprises, Inc. paid P35,200 in legal fees to successfully defend the…
A: On January 1, 2020 Dopey Enterprises, Inc. developed a new machine that reduces the time required to…
Q: In 2020, ABC Machine Company spent P352,000 on research and development costs for an invention. This…
A: The expenses related to the patent will be the amortization expense and other expenses incurred…
Q: MG Corporation acquired a patent for a new product for $260,000 on 2 January 2013 with a useful life…
A: Solution: Annual amortization expense on Patent = Cost of patent / Estimated useful life = $260,000…
Q: Van Frank Telecommunications has a patent on a cellular transmission process. The company has…
A: Annual amortization = Cost of the patent / Life of the patent = $9,000,000 / 9 years = $1,000,000…
Q: Computing Impairment of Patent In January 2017, Idea Company purchased a patent for a new consumer…
A: Introduction: Amortization is an accounting technique that is used to reduce the market price of a…
Q: On Dec. 31, 2020, an employee filed a P3,000,000 lawsuit against Siomai Company for damages suffered…
A: The journal will be prepared by the company's management, and it will be taken as input for…
Q: During 2017, Summer Company spent P500,000 for the research and development of its patent. On…
A: Patent is an intangible fixed asset. It is amortised every year as…
Q: The Garnet Trading spent P1,440,000 in acquiring a patent on January 3, 2011. Due to the competitive…
A: Intangible Assets: Intangible assets are the resources of company having economic life of greater…
Q: Van Frank Telecommunications has a patent on a cellular transmission process. The company has…
A: The patent represents the intangible asset for the corporation entitles for amortization which…
Q: On February 5, 2020, an employee filed a P2,000,000 lawsuit against XYZ Company for damages suffered…
A: Accrued liability represents an expense that is not paid or does not log under accounts payable of…
Q: On Dec. 31, 2020, an employee filed a P3,000,000 lawsuit against Siomai Company for damages suffered…
A: solution : in the given question On Dec. 31, 2020, an employee filed a P3,000,000 lawsuit against…
Q: In January 2014, the Jennifer Corporation purchased a patent for $231,000 from Travis Company that…
A: Amortization expense: A charge created on intangible asset for its use over the life of asset. It is…
Q: Crane Company incurred $840000 of research and development costs in its laboratory to develop a new…
A: Patents: A patent is an intangible asset, as it does not have any physical existence. The patent…
Q: BioDrugs Ltd. purchased a patent for a new drug for $500,000 on January 1, 2020. The patent was…
A: In the given question, Bio Drugs Ltd purchased a patent for a new drug worth $5,00,000 on January 1,…
Q: apple Fruit Trading spent P1,440,000 in acquiring a patent on January 3, 2012. Due to the…
A: Patent is a form of intangible asset for the business which needs to be amortised over the useful…
Q: On January 1, 2008, Elyssa Company purchased a patent for a new consumer for a new consumer product…
A: This question deals with the IAS 38 "Intangible asset" As per IAS 38, intangible asset needs to…
Q: On January 3, 2012, the July Company spent P196,000 to apply for and obtain a patent on a newly…
A: A patent is a legal right to an invention that is given to a inventor company or entity for securing…
Q: On January 1, 2021, Weaver Corporation purchased a patent for $231,000. The remaining legal life is…
A: Amortization expense = Cost of patent / Estimated useful life = $231,000 / 6 = $38,500 Amortization…
Q: On January 1, 2018, Sally, Inc. bought a patent for $100,000. There were ten years left of the…
A: Patent amortization is a system of recording or charging price, through which companies allocate the…
Q: In May 2021, Cruiser Company filed suit against Stallman, Inc. seeking P850,000 damages for patent…
A: Contingent assets are those probable assets whose existence would be confirmed through the non-…
Q: On December 31, 2012, BTS Company sold a machine to GOT Co and simultaneously leased it back for one…
A: Deferred revenue is the liability on the balance sheet of the company, which states the prepayment…
Q: Stars Corporation incurred a P198,900 of research and development costs to develop a product for…
A: January 2, 2017: Legal cost and other costs of patent = P44,200 Useful economic life = 20 years On…
Q: On January 1, 2020, Russell Company purchased a copyright for $2,000,000, having an estimated useful…
A: Intangible assets is recognized at purchase cost and legal fees paid in a successful defense and any…
Q: On January 2, 2016, David Corporation purchased a patent for $500,000. The remaining legal life is…
A:
Q: Crystal Company summarized the following transactions pertaining to its patent. 2012 Spent P250,…
A: Introduction A patent is an exclusive right that is given to that new product or new invention that…
Q: On Jan 1, 20X1, ABC Corp purchased a patent for P90,000. At the time of purchase the patent was…
A: Expense is the charge against revenue. Depreciation and amortization is recorded as expense in the…
Q: How much is the loss from the patent obsolescence?
A: A patent is legal right to use the use the intangible asset. The cost of the patent is amortized…
Q: Van Frank Telecommunications has a patent on a cellular transmission process. The company has…
A: Patent Cost = 22.5 million Estimated Life in 2017 = 9 years Per year amortisation = 22.5 / 9 = 2.5…
Q: On June 30, 2016, a fire in Jeremy Company's plant caused the total loss of a production machine.…
A: Depreciation is charged on value of fixed assets in order to present and report correct carrying…
Q: Dragon Fruit Trading spent P1,440,000 in acquiring a patent on January 3, 2012. Due to the…
A: Amortization is the diminution in the worth of intangible asset due to its obsolescence or limited…
Q: During 2016, Martinez Corporation spent $155,520 In research and development costs. As a result, a…
A: Research and developments costs are to be capitalized as they are capital expenditure. Patents are…
Q: Raya corporation spent $150,000 developing a new process before achieving economic viability,…
A: A patent is a type of intangible asset.
Q: On December 31, 2019, Hairy Inc. Sold computer equipment to Barber Co and immediately leased it back…
A: Deferred revenue refers to the amount of money received in advance by a company before having earned…
Q: How much is the loss on patent obsolescence?
A: Particulars Amount Balance of patents as of 1st January, 2018 P120,000 Less:- Accumulated…
Q: During 2016, Martinez Corporation spent $155,520 in research and development costs. As a result, a…
A:
Q: At the beginning of the current year, Milk Tea Company acquired a trademark for P2,000,000. The…
A: Impairment loss = Carrying cost - Value in use Carrying cost = P2,000,000 Value in use ( present…
Q: Paradise, a manufacturer located in rural New Brunswick, purchased a widget-making machine in 2017…
A: Impairment occurs when :- Recoverable Amount of the asset < Carrying amount (Net Book Value)…
Q: On January 4, 2016, Franc Company purchased for $30,000 a patent that had been filed 8 years…
A: Amortization means reducing the book value of an intangible asset regularly. It is spreading the…
Q: During 2016, Winston Corporation spent $170,000 in research and development costs. As a result, a…
A: Step 1: a. Journal entry: In the first entry, research and development account is debited and the…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- apple Fruit Trading spent P1,440,000 in acquiring a patent on January 3, 2012. Due to the competitive nature of the product, the patent was estimated to have a useful life of 10 years. At the beginning of 2016, the company paid P180,000 for legal fees in a successful defense of the patent. On July 1, 2020, a competitor obtained rights to a patent which made apple Fruit’s patent obsolete. How much is the loss from the patent obsolescence? P216,000 P243,000 P261,000 P396,000 answer not givenThe Garnet Trading spent P1,440,000 in acquiring a patent on January 3, 2011. Due to the competitive nature of the product, the patent was estimated to have a useful life of 10 years. beginning of 2015, the company paid P180,000 for legal fees in a successful defense of the patent. On July 1, 2019, a competitor obtained rights to a patent which made Garnet's patent obsolete. How much is the loss from the patent obsolescence? The correct answer is a. 216,000 Please give me a solution to this answer.2. JPIA Company spent P1, 920, 000 in acquiring a patent on January 3, 2016. Due to the competitive nature of the product, the patent was estimated to have a useful life of 10 years. At the beginning of 2018, the company paid P240, 000 for legal fees in a successful defense of the patent. On July 1, 2022, a competitor obtained rights to a patent which made JPIA's patent obsolete. How much is the loss from the patent obsolescence?
- VirusGo Inc. purchased a patent on January 1, 2017, for $800,000 for non-fogging face masks. At the time of the purchase, the patent had a remaining legal life of 10 years. In January, 2020, Maskless spent $100,000 successfully defending the patent in court. One of the other results of the court case was the discovery that the patent would only have a remaining useful life of 3 years. VirusGo's year-end is December 31. By how much is amortization expense debited in 2017? By how much is amortization expense debited in 2020? What is the net carrying value of the patent on December 31, 2019?…VirusGo Inc. purchased a patent on January 1, 2017, for $800,000 for non-fogging face masks. At the time of the purchase, the patent had a remaining legal life of 10 years. In January, 2020, Maskless spent $100,000 successfully defending the patent in court. One of the other results of the court case was the discovery that the patent would only have a remaining useful life of 3 years. VirusGo's year-end is December 31. By how much is amortization expense debited in 2017? By how much is amortization expense debited in 2020? What is the net carrying value of the patent on December 31, 2019?…Belkin Plc purchased a patent for $135,000 on September 1, 2016. It had a useful life of 10 years. On January 1, 2018, Belkin spent $33,000 to successfully defend the patent in a lawsuit. Belkin feels that as of that date, the remaining useful life is 5 years. What amount should be reported for patent amortization expense for 2018?
- On January 1, 2017, Jayjay Company, a large company, purchased a patent for a new consumer product for P4,800,000. At the time of purchase, the patent was valid for 10 years. However, the patent's useful life was estimated to be only 8 years due to a competitive nature of the product. On December 31, 2020, the product was permanently withdrawn from sale under government order because of a potential health hazard in the product. What amount should Jayjay Company charge against income during 2020, assuming amortization is recorded at the end of the such year? a. P600,000 b. P3,000,000 c. P3,360,000 d. P3,600,000Kingbird had one patent recorded on its books as of January 1, 2017. This patent had a book value of $129,600 and a remaining useful life of 6 years. During 2017, Kingbird incurred research and development costs of $203,500 related to this patent and was sued by a competitor to nullify the patent. On September 1, 2017, the Court found that Kingbird's patent was valid and that its competitor could not use the process Kingbird had patented. The company incurred $65,280 to defend this patent. At what amount should patent(s) be reported on the December 31, 2017, balance sheet, assuming monthly amortization of patents? Carrying amount 12/31/17 $Nieland Industries had one patent recorded on its books as of January 1, 2017. This patent had a book value of $288,000 and a remaining useful life of 8 years. During 2017, Nieland incurred research and development costs of $96,000 and brought a patent infringement suit against a competitor. On December 1, 2017, Nieland received the good news that its patent was valid and that its competitor could not use the process Nieland had patented. The company incurred $85,000 to defend this patent. At what amount should patent(s) be reported on the December 31, 2017, balance sheet, assuming monthly amortization of patents?
- On Jan 1, 20X1, ABC Corp purchased a patent for P90,000. At the time of purchase the patent was valid for 15 years, however the patent's useful life was estimated to be only ten years due to the competitive nature of the product. On Dec 31, 20X3, the product was permanently withdrawn from sale in the market due to its potential damage to environment. What amount should ABC charge against revenue at Dec 31, 20X3?On January 2, 2016, David Corporation purchased a patent for $500,000. The remaining legal life is 12 years, but the company estimated that the patent will be useful only for eight years. In January 2018, the company incurred legal fees of $45,000 in successfully defending a patent infringement suit. The successful defense did not change the company’s estimate of useful life. Required: Prepare journal entries related to the patent for 2016, 2017, and 2018.Splish Brothers Industries had one patent recorded on its books as of January 1, 2020. This patent had a book value of $480,000 and a remaining useful life of 8 years. During 2020, Splish Brothers incurred research and development costs of $92,000 and brought a patent infringement suit against a competitor. On December 1, 2020, Splish Brothers received the good news that its patent was valid and that its competitor could not use the process Splish Brothers had patented. The company incurred $127,500 to defend this patent. At what amount should patent(s) be reported on the December 31, 2020, balance sheet, assuming monthly amortization of patents? The amount to be reported $