On January 1, 2018, Weaver Corporation purchased a patent
for $237,000. The remaining legal life is 20 years, but the company estimates
the patent will be useful for only six more years. In January 2020, the company
incurred legal fees of $57,000 in successfully defending a patent infringement
suit. The successful defense did not change the company’s estimate of useful
life. Weaver Corporation’s year-end is December 31.
Required:
1. Record the purchase in 2018; amortization in 2018;
amortization in 2019; legal fees in 2020; and amortization in 2020.
2. What is the balance in the Patent account at the end of
2020?
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