Acc/291 Week-2 Problems and Assignments

E9-1

A. In this case, with the cost principle, the acquisition cost for the plant asset will contain all expenditures essential to obtain the asset and make it prepared for its specific purpose.

B. 1. Land 2. Factory Machinery 3. Delivery Equipment 4. Land Improvements 5. Delivery Equipment 6. Factory Machinery 7. Prepaid Insurance 8. License Expense

E9-7

A. 1. 2011: $3,500 2012: $3,500

2. $0.28 per mile 2011: $4,200 2012: $3,360

3. 2011: $7,500 2012: $5,625

B. 1. Depreciation Expense 3,500 3,500

2. Delivery Truck 30,000 Accumulated Depreciation 3,500 $26,500

E9-12
Dec. 31 Amortization Expense: Patent 12,000 12,000

P9-7B

A. Jan. 2 Patents 45,000 45,000

Jan. Research and Development June Expense 230,000 230,000

Sept. 1 Advertising Expense 125,000 125,000

Oct. 1 Copyright 200,000 200,000

B. Dec. 31 Amortization Expense: Patents 15,000 15,000

31 Amortization Expense: Copyright 7,000 7,000

C. Intangible Assets Patents 120,000 Copyright 229,000 Total intangible assets $349,000

D. Company’s Intangible Assets: 2 patents and 2 copyrights.
-Patent 1: Total cost - $145,000 – we have $100,000 amortized over a period of 10-