Copyrights
Definition: Exclusive rights to creative works
Scope:ModerateDifficulty:Easy
Exclusive rights to creative works
Common Journal Entries
| Account | Debit | Credit |
|---|---|---|
| 1. Purchase copyright | ||
| Acquire copyright for $30,000; 10-year useful life. | ||
| CopyrightsAsset+ | $30,000 | |
| CashAsset− | $30,000 | |
| Intangible asset capitalized at acquisition cost. | ||
| 2. Annual amortization | ||
| $30,000 / 10 = $3,000. | ||
| Amortization ExpenseExpense+ | $3,000 | |
| CopyrightsAsset− | $3,000 | |
| Straight-line over economic useful life. | ||
T-AccountsA visual representation of a ledger account shaped like the letter T. Left side shows debits, right side shows credits.
CopyrightsCopyrightsAssetA resource owned by the business. Normal balance: debit. Debits increase, credits decrease.
DebitLeft side of a journal entry. Increases assets and expenses. Decreases liabilities, equity, and revenue.
$30,000.00
◀ Normal bal.
CreditRight side of a journal entry. Increases liabilities, equity, and revenue. Decreases assets and expenses.
$3,000.00
$27,000.00
CashAsset account. Debits increase the balance. Credits decrease the balance.AssetA resource owned by the business. Normal balance: debit. Debits increase, credits decrease.
DebitLeft side of a journal entry. Increases assets and expenses. Decreases liabilities, equity, and revenue.
◀ Normal bal.
CreditRight side of a journal entry. Increases liabilities, equity, and revenue. Decreases assets and expenses.
$30,000.00
$30,000.00
Amortization ExpenseAmortization ExpenseExpenseA cost incurred in the process of earning revenue. Normal balance: debit. Debits increase, credits decrease.
DebitLeft side of a journal entry. Increases assets and expenses. Decreases liabilities, equity, and revenue.
$3,000.00
◀ Normal bal.
CreditRight side of a journal entry. Increases liabilities, equity, and revenue. Decreases assets and expenses.
$3,000.00
DurationLong-Term
External Links
- Copyright — Wikipedia