On July 1, 2015, Arvolo Corporation purchased a copyright for $90,000.It is estimated that the copyright will have a useful life of 5 years with no residual value.The amount of Amortization Expense recognized for the year 2015 would be

Question

Quizplus · Accepted Answer

Amortization expense is calculated by dividing the cost of the copyright by its useful life. In this case, the cost is $90,000 and the useful life is 5 years, so the annual amortization expense would be $18,000 ($90,000/5 years). Since the copyright was purchased on July 1, 2015, only half a year of amortization would be recognized in 2015, which is $9,000. Therefore, the correct answer is choice B.

On July 1, 2015, Arvolo Corporation Purchased a Copyright for $90,000.It