Bricktown Exchange purchases a copyright for $50,000. The copyright has a remaining legal life of 25 years

Bricktown Exchange purchases a copyright for $50,000. The copyright has a remaining legal life of 25 years, but only an expected useful life of five years with no residual value. Assume the company uses the straight-line method to record amortization.
What is the carrying value of the copyright at the end of the second year?

A) $10,000.

B) $40,000.

C) $50,000.

D) $30,000.

Answer: D

Bricktown Exchange purchases a copyright for $50,000. The copyright has a remaining legal life of 25 years, but only an expected useful life of five years with no residual value. Assume the company uses the straight-line method to record amortization.
What is the carrying value of the copyright at the end of the first year?

A) $0.

B) $10,000.

C) $50,000.

D) $40,000.

Answer: D

Berry Co. purchases a patent on January 1, 2021, for $40,000 and the patent has an expected useful life of five years with no residual value. Assuming Berry Co. uses the straight-line method, what is the amortization expense for the year ended December 31, 2022?

A) $0.

B) $8,000.

C) $16,000.

D) $40,000.

Answer: B

Bricktown Exchange purchases a copyright for $50,000. The copyright has a remaining legal life of 25 years,

Bricktown Exchange purchases a copyright for $50,000. The copyright has a remaining legal life of 25 years, but only an expected useful life of five years with no residual value. Assume the company uses the straight-line method to record amortization.
What is the carrying value of the copyright at the end of the first year?

A) $0.

B) $10,000.

C) $50,000.

D) $40,000.

Answer: D

Which of the following statements is true regarding the amortization of intangible assets?

A) The expected residual value of most intangible assets is zero.

B) The service life of an intangible asset is always equal to its legal life.

C) Intangible assets with a limited useful life are not amortized.

D) In recording amortization, an accumulated amortization account is always used.

Answer: A

Which of the following amortization methods is most commonly used?

A) Straight-line.

B) Double-declining-balance.

C) Activity-based.

D) A combination of methods.

Answer: A