Question

A patent was purchased with an estimated useful life of eight years for $400,000. What is the cost of the patent per year?

1) $50,000
2) $80,000
3) $100,000
4) $200,000

Answer 1

The cost of the patent per year is $50,000.

Step-by-step explanation:

The cost of the patent per year can be calculated by dividing the purchase price of the patent by its estimated useful life. In this case, the patent was purchased for $400,000 with an estimated useful life of eight years. To find the cost per year, divide $400,000 by 8 years. The cost of the patent per year is $50,000.