On January 1. Year 1, Martin Manufacturing Company paid $55,000 to obtain a patent. Martin expected the patent to have a 25 year useful life and a $5,000 salvage value. The patent's legal life is 20 years. Which of the following shows how the recognition of amortization expense will affect the Year 3 financial statements? Balance sheet Income Statement Statement of Cash Flows Assets |Liab. EquityRev. ExpNet Inc. NA2,000 (2,000) NA2,500 (2, 500) (2,5ee) NA2,000 (2,000) 2,000 oA NA (2,500) OA NA B. (2,500)(2,500) NA D. (2,ee0)(2,0 NA Q2: On January 1, Year 1, McGraw Company paid $1,000,000 to obtain a copyright. McGraw expected the copyright to have a 10 year useful life. Which of the following shows the amount of the book value of the copyright, the amortization expense, and the cash flow from operating activities on the Year 3 financial statements? Book value of Amortization Cash flow from Operating Activities Zero Zero ($3e0,e00) OA ($100,e0e) OA Copyright Expense $700,00e $700,00e $700,00e $7ee, eee $30e, e0 $19e, e0 $300,eee $100,eee Q3: On January 1, Year 1, Marino Moving Company paid $48,000 cash to purchase a truck. Marino planned to drive the truck for 100,000 miles and then to sell it. The truck was expected to have an $8,000 salvage value. The truck was actually driven 40,000 miles during Year 1, 20,000 miles during Year 2, 35,000 miles during Year 3 and 10,000 miles during Year 4. If Marino uses the units-of-production method, which of the following shows how the adjusting entry to recognize depreciation expense at the end of Year 3 will affect the Company's financial statements? Balance sheet Assets Income Statement Cash Flow Statement - 14,000(14,000) (14,ee0) OA Cash TruckAcc. Dep. Liab. Equity Rev. ExpNet Inc. 14,eeeN14,eee 14,90e 14,000 NA(14,00e) NA 38,000 38,000 =| NA | + | 14,000 NA NA NA + NA - + NA - + NA - + NA - NA =| NA | | 38,000 -| NA | +| 38,000 NA - 38,00038,000) (38,ee0) OA