Intangible assets

Question 1

Amortisation

Answer 1

Depreciation of an intangible asset

Question 2

Recognise intangible assets

Answer 2

• Identifiable
• controllable
• reliable measure
• give future economic benefits

Question 3

Research Expenditure

Answer 3

• always expensed

- not an intabgible assets

Question 4

Development Expenditure - capitalised if

Answer 4

• commercially viable
• profitable
• identified expenditure
• separate project
• resources to complete the project
• technically feasible to create the product

Question 5

Treatment of intangible asset

Answer 5

• at cost

- cost model/revaluation

Question 6

Treatment of intangible asset (indefinite life)

Answer 6

• no amortisation
• do not know the expected life
• impairment test each year

Question 7

Treatment of intangible asset (amortisation)

Answer 7

• straight line
• start when production begins
• in line with sales
• to P/L - review anually

Question 8

Amortisation equation

Answer 8

• (capitalised expenditure x revenue for the year)/total expected revenue

Question 9

we do capitalised

Answer 9

• purchased goodwill
• purchased intangibles
• purchases computer software

Question 10

we do not capitalise

Answer 10

• internally generated -goodwill, brands, customer lists

- expenses - training, start up, advertising