ACCT 001 Lecture Notes - Lecture 16: Expense, Income Statement, Intangible Asset
23 Dec 2020
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Document Summary
Intangible assets are identifiable, non-monetary assets that do not have a visible physical existence, unlike land, buildings or equipment. They are recorded at their fair value at the date of acquisition and recognised separately. If an asset has an indefinite life, they are not amortised but tested for impairment on an annual basis to determine whether the value should be written down (reducing profit). Intangible assets with a finite life is amortised over the period during which the company believes the items will provide benefit. Brand names: which can be registered to maintain exclusive use. Franchises, distributorships and other rights to sell someone else"s products in a certain geographical area, where the local operator has paid for the right to use the name and sell the products. Deferred change: such as incorporation costs, financing costs, and other items that are long-term period expenses.
