Ely purchased a patent with a remaining legal life of ten

Reference no: EM13479959

1.Ely purchased a patent (with a remaining legal life of ten years) from Backo on January 1, 2010 for $300,000. Ely expected to use the patent for five years. The carrying value on Backo's books was $90,000. Show calculations. How much should be amortized for 2010?
a. $9,000

b. $18,000

c. $30,000

d. $60,000

2.Day Corporation purchased a patent on January 1, 2012 for $360,000. The patent had a useful life of 10 years at that date. In January of 2013, Day successfully defends the patent at a cost of $162,000, extending the life of the patent. What amount of amortization expense should be recorded in 2013? Show calculations.
a. $36,000
b. $40,500
c. $43,500

d. $54,000

3.Blue sky Company's 12-31-13 balance sheet reports assets of $5,000,000 and liabilities of $2,000,000. All of the book value's are the same as the market values except for land, which has a higher market value by $300,000.
On 12-31-13, Horace Wimp paid $5,100,000 to acquire Blue Sky. What amount of goodwill should Horace Wimp record as a result of the purchase? Show calculations.
a. $-0-
b. $100,000
c. $1,800,000
d. $2,100,000

Reference no: EM13479959

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