Problem:
Janes Company provided the following information on intangible assets:
1) A patent was purchased from the Lou Company for $760,000 on January 1, 2009. Janes estimated the remaining useful life of the patent to be 10 years. The patent was carried on Lou's accounting records at a net book value of $390,000 when Lou sold it to Janes.
2) During 2011, a franchise was purchased from the Rink Company for $520,000. The contractual life of the franchise is 10 years and Janes records a full year of amortization in the year of purchase.
3) Janes incurred research and development costs in 2011 as follows:
Materials and supplies $ 156,000
Personnel 184,000
Indirect costs 79,000
Total $ 419,000
4) Effective January 1, 2011, based on new events that have occurred, Janes estimates that the remaining life of the patent purchased from Lou is only four more years.
Prepare a schedule showing the intangible asset section of Janes's December 31, 2011, balance sheet. (Round your answers to the nearest dollar amount.Omit the "$" sign in your response.)
Balance Sheet
December 31, 2011
Intangible assets:
Patent $_____________
Franchise $_____________
Total intangibles $______________