Question - Celine Dion Corporation purchases a patent from Salmon Company on January 1, 2010, for $54,000. The patent has a remaining legal life of 16years. Celine Dion Corporation feels the patent will be useful for 10 years.
Use the information provided above. Assume that at January 1, 2012 the carrying amount of the patent on Celine Dion's books s $43,200. In January, Celine Dion spends $24,000 successfully defending a patent suit. Celine Dion still feels the patent will be useful until the end of 2019. Prepare the journal entries to record the $24,000 expenditure and 2012 amortization.