Answer:
a. The amount of amortization expense during Year 3 is $40,000.
b.The book value of the patent as of December 31, Year 3 is $80,000.
Explanation:
For amortization of patient, it is done using which one is shorter between the useful life and legal life.
We therefore use the useful life in this question since it is the one that is shorter to amortize as follows:
Annual amortization expenses = $200,000 ÷ 5 = $40,000
Accumulated annual amortization for 3 years = $40,000 × 3 = $120,000
Book value of the patent in year 3 = $200,000 - $120,000 = $80,000
Therefore, the amount of amortization expense during Year 3 is $40,000 and the book value of the patent as of December 31, Year 3 is $80,000.
Answer:
$40,000 and $80,000
Explanation:
Amortization expense/year=($200,000/5)=$40000/year.
Hence amortization expense for December 31,2018= $40,000
Book value as on December 31,2018=$200,000-(40000*3)=$80,000
