The following information concerns the intangible assets of Epstein Corporation:
a. On June 30, 2016, Epstein completed the acquisition of the Johnstone Corporation for $1,820,000 in cash. The fair value of the net identifiable assets of Johnstone was $1,550,000.
b. Included in the assets purchased from Johnstone was a patent that was valued at $84,600. The remaining legal life of the patent was 14 years, but Epstein believes that the patent will only be useful for another nine years.
c. Epstein acquired a franchise on October 1, 2016, by paying an initial franchise fee of $206,800. The contractual life of the franchise is 11 years.
Required:
1. Prepare year-end adjusting journal entries to record amortization expense on the intangibles at December 31, 2016. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
2. Prepare the intangible asset section of the December 31, 2016, balance sheet. (Do not round intermediate calculations.)