Everly must restore the property( estimated fair value of the obligatio n is $ 100,320), after which it can be sold for $ 200,640. Everly estimat es that 5,016 tons of coal can be extracted. If 878 tons are extracted th e first year, prepare the journal entry to record depletion. Question 22 Francis Corporation purchased an asset at a cost of $ 58,200 on March 1, 2012. The asset has a useful life of 8 years and a salvage value of $ 5,820. For tax purposes, the MACRS class life is 5 years. Compute ta x depreciation for each year 2012 – 2017. Question 23 Celine Dion Corporation purchases a patent from Salmon Company o n January 1, 2012, for $ 50,820. The patent has a remaining legal life o f 16 years. Celine Dion feels the patent will be useful for 10 years. Pre pare Celine Dion’ s journal entries to record the purchase of the patent and 2012 amortization. Question 24 Karen Austin Corporation has capitalized software costs of $ 768,500, and sales of this product the first year totaled $ 390,630. Karen Austin anticipates earning $ 911,470 in additional future revenues from this p roduct, which is estimated to have an economic life of 4 years. Comp ute the amount of software cost amortization for the first year.( a) Compute the amount of software cost amortization for the first yea r using the percent of revenue approach.( b) Compute the amount of software cost amortization for the first yea r using the straight-line approach. Question 25 Jeff Beck is a farmer who owns land which borders on the right-ofway of the Northern Railroad. On August 10, 2012, due to the admitte d negligence of the Railroad, hay on the farm was set on fire and burn ed. Beck had had a dispute with the Railroad for several years concern ing the ownership of a small parcel of land. The representative of the Railroad has offered to assign any rights which the Railroad may have in the land to Beck in exchange for a release of his right to reimburse ment for the loss he has sustained from the fire. Beck appears inclined to accept the Railroad’ s offer. The Railroad’ s 2012 financial statemen ts should include the following related to the incident: A). recognition of a loss only.