Question

When S. Dee Company bought B. Darin Company, the purchase price included a patent valued at $15,000. The patent has 10 years remaining of its legal life, but its estimated useful life to S. Dee Company was only 8 years. The journal entry to record the annual patent amortization would include a:

A) debit to Patent, $1,875.

B) debit to Amortization expense, $1,875.

C) credit to Patent, $1,500.

D) credit to Amortization expense, $1,500.

Answer

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