Amortization deduction for the year of purchase

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As part of the purchase price of a business, on January 1, Sam Farrow pays $100,000 for the patent to an industrial gear. In addition, as part of the same purchase, Sam pays $10,000 for the business's goodwill and another $10,000 for the seller's covenant not to compete for the next five years. Compute Sam's amortization deduction for the year of purchase.

Reference no: EM13121698

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