Potter Company incurred research and development costs prior technological feasibility of €1140000 and legal fees of 6480000 to acquire a patent

Accounting Jan 18, 2021

Potter Company incurred research and development costs prior technological feasibility of €1140000 and legal fees of 6480000 to acquire a patent. The patent has a legal life of 20 years and a useful life of 15 years. What should Potter record as Patent balance in the second year? O a 1172000 O b. 448000 O c416000 O d. 76000 O e. 1108000 Of. 32000

Expert Solution

Answer: C 416,000

Annual write off valve of patent

: Legal fee paid for patent/Useful life

:480,000/15 =32000

Balance after year =

480,000-32,000 = 448,000

Balance after 2nd year

448,000-32000=416,000

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