How to write accounting entries when transferring the right to use patent rights?

In the course of business, enterprises sometimes transfer the right to use patents in order to obtain certain profits, which are generally included in other business income subjects. So how do you write the specific accounting entries when an enterprise transfers the right to use a patent?

Accounting entries for the transfer of patent use rights

1. Earn rental income:

Debit: bank deposit

Loans: other business income

2. Carry forward VAT payable:

Borrow: taxes and surcharges

Loan: Taxes payable-VAT payable

Borrow: taxes and surcharges

Loan: taxes payable-consumption tax, urban construction tax, etc.

3. Amortize the patent cost:

Debit: other business costs

production cost

Loan: accumulated amortization

What is other business income?

Other business income refers to the inflow of economic benefits formed by daily activities such as selling goods, providing labor services and transferring the right to use assets other than the main business income of an enterprise. Such as sales of materials, materials and packaging materials, licensed use of intangible assets, rental of fixed assets, rental of packaging materials, transportation, sales of waste materials, etc.

What is a bank deposit?

Bank deposit is the currency deposited in the bank, and it is an integral part of monetary funds. According to the provisions of China's cash management system, every enterprise must open a deposit account with the People's Bank of China or a specialized bank for deposit and withdrawal and transfer settlement. In addition to a small amount of cash within the prescribed limit, the monetary funds of an enterprise must be deposited in the bank.

In order to reflect and supervise the income, expenditure and balance of enterprise bank deposits, enterprises should set up the subject of "bank deposits", increase the bank deposits registered by borrowers and reduce the bank deposits registered by lenders. The final debit balance reflects the actual amount of bank deposits held by enterprises at the end of the period.

How much is the tax and surcharge?

Taxes and fees refer to the relevant taxes and fees that enterprises should bear in their business activities, including consumption tax, urban maintenance and construction tax, resource tax, education surcharge, property tax, travel tax, urban land use tax, stamp tax, etc.