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1 April, 06:05

Berry Co. purchases a patent on January 1, 2021, for $42,000 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 carrying value of the patent on December 31, 2022

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  1. 1 April, 09:31
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    Answer:$25,200

    Explanation:

    Since amortization is on a straight-line basis and the patent has no residual value;

    Annual amortization value = $42,000/5years

    =$8,400

    As at December 31, 2022, accumulated amortization is $16,800

    Carrying amount of the patent: $42,000-$16,800

    = $25,200
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