Gordon Corporation produced 10,000 digital watches in the current year. Variable costs are $8 per watch. Overhead assigned is $2

Answer:

A. Dr Amortization expense $43,750

Cr Patents $43,750

B. Dr Amortization expense $5,230

Cr Patents $5,230

C. Dr Amortization expense $14,000

Cr Franchises $14,000

Explanation:

Journal entry preparations

A. Dr Amortization expense $43,750

($350,000÷8 years = $43,750)

Cr Patents $43,750

(Recording amortization for the patent)

B. Dr Amortization expense $5,230

($52,300÷10 years = $5,230)

Cr Patents $5,230

(Recording amortization for the patent)

C. Dr Amortization expense $14,000

($70,000÷5 years = $14,000)

Cr Franchises $14,000

(Recording amortization for franchises)

Answer:

Prof. Finance can withdraw an annual annuity of $ 110,698

Explanation:

Prof. Finance's present value is $1,500,000, which reflects his savings at retirement age 65, so PV= 1,500,000

6% is the interest rate established, so r=6%

Number of withdrawals planned = 25

PMT= $110,698