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On June 1, 2019, Red Corporation purchased an existing business. With respect to the acquired assets of the business, Red allocated $300,000 of the purchase price to a patent. The patent will expire in 20 years. Determine the total amount that Red may amortize for 2019 for the patent

Respuesta :

Answer:

The correct option is (c)

Explanation:

Amortization is the way toward assigning the cost of an intangible resource over its valuable life. Straight-line amortization is one strategy for doing as such.

The method does evaluate the total amount Red may amortize for 2019:

$11,667 [$300,000 × (7 months/180 months)]. The total amount Red should amortize is 11,667$ for the year 2019.

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