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This question has the following TWO independent parts. Assume that all companies mentioned in this question have a December fiscal-year-end. Part I (20 points): Diamond Towing Company purchased a tow truck for $200,000 on January 1, 2017. It was originally depreciated on a straight-line basis over 10 years with an assumed residual value of $50,000. On December 31, 2021, before adjusting entries had been made, the company decided to change the remaining estimated life to 4 years (including 2021) and the residual value to $10,000. Required: Prepare the adjusting entries for fiscal years 2020 and 2021, respectively. (Note: Write no entry when no entry is required.) Debit Credit Date Dec. 31, 2020 (Adjusting entry) Dec. 31, 2021 (Adjusting entry) Optional: Show computations below. Part II (24 points): On January 1, 2020, Silverlight company purchased a patent for $400,000 cash. The patent's legal life is 20 years but the company estimates that the patent's useful life will only be 5 years from the date of acquisition. On June 30, 2020, the company paid legal costs of $160,000, but it failed to defend the patent in an infringement suit. Required: Prepare the necessary journal entries, including an adjusting entry, if any. (Note: Write no entry when no entry is required.) Debit Credit Date Jan. 1, 2020 Jun. 30, 2020 Dec. 31, 2020 (Adjusting entry) Optional: Show computations below

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