Homework answers / question archive / Marin Industries has the following patents on its December 31, 2019, balance sheet

Marin Industries has the following patents on its December 31, 2019, balance sheet

Accounting

Share With

---

Marin Industries has the following patents on its December 31, 2019, balance sheet.

 

Patent Item Initial Cost Date Acquired Useful Life at Date Acquired

Patent A $43,452 3/1/16 17 years

Patent B $16,560 7/1/17 10 years

Patent C $20,640 9/1/18 4 years

 

The following events occurred during the year ended December 31, 2020.

 

1. Research and development costs of $243,000 were incurred during the year.

2. Patent D was purchased on July 1 for $34,770. This patent has a useful life of 91/2 years.

3. As a result of reduced demands for certain products protected by Patent B, a possible impairment of Patent B's value may have occurred at December 31, 2020. The controller for Marin estimates the expected future cash flows from Patent B will be as follows.

 

Year Expected Future Cash Flows

2021 $2,000

2022 2,000

2023 2,000

 

The proper discount rate to be used for these flows is 8%. (Assume that the cash flows occur at the end of the year.)

 

 

Collapse question part

(a)

Compute the total carrying amount of Marin' patents on its December 31, 2019, balance sheet.

 

Total carrying amount

$enter the Total carrying amount in dollars