Ask Question
BusinessBusiness
10 June, 20:33

Franklin designs purchased the patent of a new couch design. the patent had a remaining life of 18 years, so franklin amortized the cost of the patent over 18 years. however, experts believe that the couch design will only be popular for six years. how will this affect the accuracy of franklin's financial statements?

+1
Answers (1)
  1. 10 June, 20:45
    0
    If amortisation expenses are spread over 18 years rather than 6 years, amortisation expenses will be lower than they should be. This will cause an increase in net income. In addition, because less of the cost has been expensed, the remaining value of the patent will be too high, thus overstating assets.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Franklin designs purchased the patent of a new couch design. the patent had a remaining life of 18 years, so franklin amortized the cost of ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
Total taxes paid divided by total income is called the
Answers (1)
A highly specialized field of medical science charged with the task of identifying criminal responsibility is known as:
Answers (1)
Joan wants to get a $1,000 loan from her local bank. she finds out the current interest rate is 17%. would you advise her to get the loan or to not get the loan.
Answers (1)
Our company is deciding whether to invest in a new machine. The new machine will increase cash flow by $324,000 per year.
Answers (1)
Question 3. If inflation turns out to be lower than expected, then: a) savers benefit. b) borrowers benefit while savers are not affected. c) savers and borrowers are equally affected. d) savers are adversely affected but borrowers benefit.
Answers (1)
New Questions in Business
Homer can write checks on his account at intercity bank. jemma steals the checks, forges homer's signature, and cashes the checks at intercity.
Answers (1)
What is the goal for mass customization? A. The goal is to seek creative designs, efficient production, and high-quality goods via international collaboration. B.
Answers (1)
A company could improve its acid-test ratio by selling some equipment it no longer needs for cash. a. True b. Flase
Answers (1)
A company which sources raw materials and components from overseas will hold extra inventory of these items due to a mismatch between the timing of customer demand and supply chain lead times. This type of inventory is A. cycle stock. B.
Answers (1)
Retired people will be draining the u. s. economy of wealth. this is due to:
Answers (1)
Home » Business » Franklin designs purchased the patent of a new couch design. the patent had a remaining life of 18 years, so franklin amortized the cost of the patent over 18 years. however, experts believe that the couch design will only be popular for six years.
Sign Up Forgot Password?