ACC 100 Chapter Notes - Chapter 8: Intangible Asset, Asset, Fixed Asset

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Intangible assets with a deinite life oten have two ime periods that must be considered: the legal life and the esimated useful life. The legal life is what the law allows the business to use the intangible asset for. The esimated useful life is how long the intangible asset will beneit the business. When the owner of the business is calculaing amorizaion for an intangible asset, they should use which one: the esimated useful life, the legal life, whichever is greater, whichever is lower. If the business can only legally use the asset for 5 years but they think it will be useful for 10, they sill have to use the whichever is less!!! So, in this case, they would use 5 years because it is less: alternaive names. There are two names for when a long lived asset"s use is recognized: depreciaion and amorizaion.

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