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Colmey Company acquired patent rights on January 3, 2004, for $472,500. The patent has a useful life equal to its legal life of 15 years. On January 5, 2007, Colmey successfully defended the patent in a lawsuit at a cost of $75,000.
a. Determine the patent amortization expense for the current year ended December 31, 2007.
b. Journalize the adjusting entry to recognize the amortization.
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