Reference no: EM132576076

Question - The following transactions involving intangible assets of Sand Corporation occurred on or near December 31, 2020.

a. Sand paid Beach Company $450,000 for the exclusive right to market a particular product, using the Beach name and logo in promotional material. The franchise runs for as long as Sand is in business. Sand decided to amortize the franchise over 25 years.

b. Sand spent $100,000 developing a new manufacturing process and has applied for a patent. It believes that its application will be successful and that the process will be successfully implemented and used for 10 years.

c. In January 2018, Sand 's application for a patent (#2 above) was granted. Legal and registration costs incurred were $25,000. The patent runs for 18 years from the grant date. The manufacturing process will be useful to Sand for 10 years.

d. Sand incurred $80,000 in successfully defending another of its patents in an infringement suit. The patent expires in 4 years.

e. Sand incurred $200,000 in an unsuccessful patent defense. As a result of the adverse verdict, the patent, with a remaining unamortized cost of $99,000, is deemed worthless.

f. Sand paid Mexico Laboratories $52,000 for research work performed by Mexico under contract for Sand.

Required -

1. Record the journal entry on the date of the transaction.

2. Record the journal entry at December 31, 2021 (if no entry is required, write "none needed").