Brief Exercise 12-1 Bridgeport Corporation purchases a patent from Ivanhoe Compa

Question

Brief Exercise 12-1

Bridgeport Corporation purchases a patent from Ivanhoe Company on January 1, 2017, for $74,000. The patent has a remaining legal life of 16 years. Bridgeport feels the patent will be useful for 10 years.

Prepare Bridgeport’s journal entries to record the purchase of the patent and 2017 amortization. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Brief Exercise 12-1

Bridgeport Corporation purchases a patent from Ivanhoe Company on January 1, 2017, for $74,000. The patent has a remaining legal life of 16 years. Bridgeport feels the patent will be useful for 10 years.

Prepare Bridgeport’s journal entries to record the purchase of the patent and 2017 amortization. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation Debit Credit To record purchase of patents) (To record amortization of patents)

Explanation / Answer

Journal entry :

Date account and explanation debit credit Jan 1 Patents 74000 Cash 74000 (To record purchase of patents) Dec 31 Amortization expense (74000/10) 7400 Accumlated amortization-Patent 7400 (To record amortization of patents)

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