Exercise 12-8
Sandhill Company has provided information on intangible assets as follows.
A patent was purchased from Ford Company for $2,555,000 on January 1, 2016. Sandhill estimated the remaining useful life of the patent to be 10 years. The patent was carried in Ford’s accounting records at a net book value of $2,036,000 when Ford sold it to Sandhill.
During 2017, a franchise was purchased from Polo Company for $532,000. In addition, 7% of revenue from the franchise must be paid to Polo. Revenue from the franchise for 2017 was $2,690,000. Sandhill estimates the useful life of the franchise to be 10 years and takes a full year’s amortization in the year of purchase.
Sandhill incurred research and development costs in 2017 as follows.
Materials and equipment$138,400
Personnel189,700
Indirect costs104,100
$432,200
Sandhill estimates that these costs will be recouped by December 31, 2020. The materials and equipment purchased have no alternative uses.
On January 1, 2017, because of recent events in the field, Sandhill estimates that the remaining life of the patent purchased on January 1, 2016, is only 5 years from January 1, 2017.
***************************************************************************************************************************************************************************************************
They have a magnificent team. These people are always kind and willing to listen to your concerns or issues. Better yet, your assignment is always ready before the time, they usually send you a draft to double-check before they finalize your paper.
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.
Read moreEach paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.
Read moreThanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.
Read moreYour email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.
Read moreBy sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.
Read more