BU387 Chapter Notes - Chapter 12: Impaired Asset, Book Value, Serializability
Document Summary
Identifiable intangibles with similar characteristics should be grouped and reported together. Recognition and measurement at acquisition: recognize if, probable future economic benefit, and, asset can be measured reliably. Intangible asset may be: purchased, acquired as part of a business combination, developed internally. Purchased intangibles: costs includes all expenditures necessary to get the intangible asset ready for its intended use (ie. purchase price and legal fees) If there are delayed payment terms, recognize financing expense (interest) If acquired for shares, cost is generally measured at assets fair value (or value of shares if value of asset cannot be determined) Acquired in business combination: when one business acquires control over another business and so, also their goodwill. Identifiable intangible assets acquired are recognized at fair value. Prepayments: prepaid asset can be recognized only when an entity has paid, prepaid assets represent the right to receive goods and services, and no longer exists once the goods and services are received.
