a. Journalize the adjusting entry on December 31 for the impaired goodwill.
b. Journalize the adjusting entry on December 31 for the amortization of the patent rights.
Answer:
a. Dec. 31 Loss from Impaired Goodwill 4,000,000 Goodwill 4,000,000 Impaired goodwill. b. Dec. 31 Amortization Expense—Patents 25,000
Patents 25,000 Amortized patent rights [($900,000 ÷ 15) × (5 ÷ 12)].
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