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  • Tones Industries Has The Following Patents On Its December 31

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    M Bilal Saleem
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    Tones Industries had patents on its balance sheet as of December 31, 2007. During 2008, the company incurred $245,700 in research costs and purchased Patent D for $36,480 which has a useful life of 9.5 years. Patent B may be impaired due to reduced demand for certain products. Its estimated future cash flows are $2,000 per year from 2009-2011 with an 8% discount rate. The carrying amounts of the patents on the 2007 and 2008 balance sheets must be calculated.

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    Tones Industries Has the Following Patents on Its December 31

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    Tones Industries had patents on its balance sheet as of December 31, 2007. During 2008, the company incurred $245,700 in research costs and purchased Patent D for $36,480 which has a useful life of 9.5 years. Patent B may be impaired due to reduced demand for certain products. Its estimated future cash flows are $2,000 per year from 2009-2011 with an 8% discount rate. The carrying amounts of the patents on the 2007 and 2008 balance sheets must be calculated.

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    24 views1 page

    Tones Industries Has The Following Patents On Its December 31

    Uploaded by

    M Bilal Saleem
    Tones Industries had patents on its balance sheet as of December 31, 2007. During 2008, the company incurred $245,700 in research costs and purchased Patent D for $36,480 which has a useful life of 9.5 years. Patent B may be impaired due to reduced demand for certain products. Its estimated future cash flows are $2,000 per year from 2009-2011 with an 8% discount rate. The carrying amounts of the patents on the 2007 and 2008 balance sheets must be calculated.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    of 1

    Tones Industries has the following patents on its December

    31
    Tones Industries has the following patents on its December 31, 2007, balance sheet.The
    following events occurred during the year ended December 31, 2008.1. Research and
    development costs of $245,700 were incurred.2. Patent D was purchased on July 1 for $36,480.
    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, 2008. The controller for Tones estimates the expected future cash flows from
    Patent B will be as followsYear Expected Future Cash Flows2009 .......... $2,0002010 .........
    2,0002011 ......... 2,000The proper discount rate to be used for these flows is 8%.Instructions(a)
    Compute the total carrying amount of Tones’s patents on its December 31, 2007, balance
    sheet.(b) Compute the total carrying amount of Tones’s patents on its December 31, 2008,
    balancesheet.
    View Solution:
    Tones Industries has the following patents on its December 31
    SOLUTION-- http://expertanswer.online/downloads/tones-industries-has-the-following-patents-
    on-its-december-31/

    See Answer here expertanswer.online


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