Jamestown has decided to enter into a capital lease for the purchase of its new recycling truck. The capitalizable cost of the capital asset is $175,000 and Jamestown made a $30,000 downpayment at the inception of the lease agreement
The estimated useful life of the truck is ten years. Which of the following statements is false?
a. General Fund fund balance will be reduced by $175,000
b. Other financing sources of $145,000 will be reported in Year 1
c. Expenditures of $175,000 will be reported in Year 1
d. Depreciation expense on the truck will be $17,500 per year.
e. General Fund fund balance will be reduced by $30,000
A
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Broadway Corporation was granted a patent on a product on January 1, 2001. To protect its patent, the corporation purchased on January 1, 2012 a patent on a competing product which was originally issued on January 10, 2008. Because of its unique plant, Broadway Corporation does not feel the competing patent can be used in producing a product. The cost of the competing patent should be
a. amortized over a maximum period of 20 years. b. amortized over a maximum period of 16 years. c. amortized over a maximum period of 9 years. d. expensed in 2012.
LLCs are legal entities apart from ______________ like corporations.
Fill in the blank(s) with the appropriate word(s).