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defense of the patent were paid on July 1, 2011. Sisco estimates that the
useful life of the patent will be 20 years from the date of acquisition.
(TCO C) Fred’s Company is considering the write-off of a limited life
intangible asset because of its lack of profitability. Explain to the
management of Fred’s how to determine whether a writeoff is permitted.
3. (TCO D) Edwards Co. includes one coupon in each bag of dog food it
sells. In return for four coupons, customers receive a dog toy that the
company purchases for $1.20 each. Edwards's experience indicates that
60 percent of the coupons will be redeemed. During 2010, 100,000 bags
of dog food were sold, 12,000 toys were purchased, and 40,000 coupons
were redeemed. During 2011, 120,000 bags of dog food were sold,
16,000 toys were purchased, and 60,000 coupons were redeemed.
4. (TCO D) Grider Industries, Inc. issued $6,000,000 of 8% debentures
on May 1, 2010 and received cash totaling $5,323,577. The bonds pay
interest semiannually on May 1 and November 1. The maturity date on
these bonds is November 1, 2018. The firm uses the effective-interest
method of amortizing discounts and premiums. The bonds were sold to
yield an effective-interest rate of 10%.
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ACCT 553 Week 1 Homework
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Chapter 1 (5 pts)
1. Briefly discuss the purpose of the Sixteenth Amendment
Chapter 2 (5 pts)