Danks Corporation purchased a patent for $450,000 on September 1, 2008. It had a useful life of 10
years. On January 1, 2010, Danks spent $110,000 to successfully defend the patent in a lawsuit. Danks
feels that as of that date, the remaining useful life is 5 years. What amount should be reported for
patent amortization expense for 2010?
The general ledger of Vance Corporation as of December 31, 2011, includes the following accounts:
Deposits with advertising agency (will be used to promote goodwill)
Discount on bonds payable
Excess of cost over fair value of identifiable net assets of
In the preparation of Vance's balance sheet as of December 31, 2011, what should be reported as total
Blue Sky Company’s 12/31/10 balance sheet reports assets of $5,000,000 and liabilities of $2,000,000.
All of Blue Sky’s assets’ book values approximate their fair value, except for land, which has a fair value
that is $300,000 greater than its book value. On 12/31/10, Horace Wimp Corporation paid $5,100,000
to acquire Blue Sky. What amount of goodwill should Horace Wimp record as a result of this purchase?
During 2011, Bond Company purchased the net assets of May Corporation for $1,000,000. On the date
of the transaction, May had $300,000 of liabilities. The fair value of May's assets when acquired were
How should the $500,000 difference between the fair value of the net assets acquired ($1,500,000) and
the cost ($1,000,000) be accounted for by Bond?