Question: 1. What are the characteristics of an intangible asset?
2. Mulan Enterprises pays $235,200 for equipment that will last five years and have a $52,500 salvage value. By using the equipment in its operations for five years, the company expects to earn $85,500 annually, after deducting all expenses except depreciation. Prepare a table showing income before depreciation, depreciation expense, and net (pretax) income for each year and for the total five-year period, assuming straight-line depreciation.