In january 2013 vega corporation purchased a patent

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60. In January 2013, Vega Corporation purchased a patent at a cost of $200,000. Legal and filing fees of $50,000 were paid to acquire the patent. The company estimated a 10-year useful life for the patent and uses the straight-line amortization method for all intangible assets. In 2016, Vega spent $40,000 in legal fees for an unsuccessful defense of the patent. The amount charged to income (expense and loss) in 2016 related to the patent should be: A. $40,000. B. $65,000. C. $215,000. D. $25,000. AACSB: Analytic AICPA FN: Measurement Blooms: Apply Difficulty: 2 Medium Learning Objective: 11-04 Calculate the periodic amortization of an intangible asset. Learning Objective: 11-09 Discuss the accounting treatment of repairs and maintenance; additions; improvements; and rearrangements to property; plant; and equipment and intangible assets. Spiceland - Chapter 11 #60 Topic: Calculate the periodic amortization of an intangible asset Topic: Discuss the accounting treatment of repairs and maintenance, additions, improvements, and rearrangements to PP & E and intangible assets
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61. Accounting for a change in the estimated service life of equipment: AACSB: Reflective Thinking AICPA BB: Critical Thinking Blooms: Remember Difficulty: 1 Easy Learning Objective: 11-05 Explain the appropriate accounting treatment required when a change is made in the service life or residual value of property; plant; and equipment and intangible assets. Spiceland - Chapter 11 #61 Topic: Explain the appropriate accounting treatment required when a change is made in the service life or residual value of PP & E and intangible assets 62. A change in the estimated useful life and residual value of machinery in the current year is handled as: and residual value had been used all along. the new estimates. under the new versus old estimates. AACSB: Reflective Thinking AICPA BB: Critical Thinking Blooms: Remember Difficulty: 1 Easy Learning Objective: 11-05 Explain the appropriate accounting treatment required when a change is made in the service life or residual value of property; plant; and equipment and intangible assets. Spiceland - Chapter 11 #62
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Topic: Explain the appropriate accounting treatment required when a change is made in the service life or residual value of PP & E and intangible assets
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