P10-7B The intangible assets section of Justen Company at December 31, 2008, is presented

Price: $2.50


The intangible assets section of Time Company at December 31, 2011, is presented below.

Patent ($100,000 cost less $10,000 amortization)	90000
Copyright ($60,000 cost less $24,000 amortization)	36000
Total	126,000

The patent was acquired in January 2011 and has a useful life of 10 years.The copyright was acquired
in January 2008 and also has a useful life of 10 years.The following cash transactions may
have affected intangible assets during 2012.
Jan. 2 Paid $45,000 legal costs to successfully defend the patent against infringement by
another company.
Jan.–June Developed a new product, incurring $230,000 in research and development costs.A
patent was granted for the product on July 1. Its useful life is equal to its legal life.
Sept. 1 Paid $125,000 to an Xgames star to appear in commercials advertising the
company’s products.The commercials will air in September and October.
Oct. 1 Acquired a copyright for $200,000.The copyright has a useful life of 50 years.

Instructions
(a) Prepare journal entries to record the transactions above.
(b) Prepare journal entries to record the 2012 amortization expense for intangible assets.
(c) Prepare the intangible assets section of the balance sheet at December 31, 2012.