BUS 320 Lecture Notes - Lecture 2: Intangible Asset, Book Value, Impaired Asset
16 Sep 2016
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Identifiable intangibles with similar characteristics should be grouped and reported together. In tangible assets may be 1) purchased, 2) acquired as part of a business combination, o2 3) developed internally. Cost includes all expenditures that are necessary to get the intangible asset ready for its intended use (e. g. , purchase price, legal fees) Interest on intangible assets: if there are delayed payment terms, recognize financing expense (interest) Acquired for shares: if acquired for shares, cost is generally measured at asset"s fair value (or value of shares if value of asset cannot be determined) Exchanged for non monetary assets: if intangible assets are exchanged for non-monetary assets, the fair value of the item given up or the fair value of the intangible received is used to determine cost. Basket purchase: for a basket purchase of intangibles, the cost is allocated based on fair values. Prepaid asset: can be recognized only when an entity has paid for:
