During 2013, Sarasota Corporation spent $164,160 in research and development costs. As a result, a new product called the Age piano was patented. The patent was obtained on October 1, 2013 and had a legal life of 20 years and a useful life of 10 years. Legal costs of $36,720 related to the patent were incurred as of October 1, 2013.
Prepare all journal entries required in 2013 and 2014 as result of the transactions.On June 1, 2015, Sarasota Spent $28,800 to successfully prosecute a patent infringement suit. As a result, the estimated of useful life was extended to 12 years from June 1 2015. Prepare all Journal entries required in 2015 and 2016.
In 2017, Sarasota determine that a competitors product would make the New Age Plano obsolete and the patent worthless by December 31, 2018. Prepare all journal entries required in 2017 and 2018.