Discuss whether intangible assets should be recognised

Assignment Help Accounting Basics

Reference no: EM132952990

For the last decade it has not been unusual for the premium paid to acquire control of a business to be greater than the fair value of its tangible net assets. This increase in the relative balance sheet proportions of intangible assets has made the accounting practices for them all the more important. During the same period many companies have spent a great deal of money internally developing new intangible assets such as software and brands. IAS 38 'Intangible Assets' was issued in September 1998 and prescribes the accounting treatment for intangible assets.

Required:

In accordance with IAS 38, discuss whether intangible assets should be recognised, and if so how they should be initially recorded and subsequently amortised in the following circumstances:

a) when they are purchased separately from other assets;

b) when they are obtained as part of acquiring the whole of a business; and

c) when they are developed internally.

Reference no: EM132952990

Questions Cloud

Produce a statement showing the overhead split : Produce a statement showing the overhead split using Activity Based Costing. Show the amount per unit produced.

Discuss how you would improve cash flow : Discuss how you would improve cash flow, given the CFO does not have enough cash on hand to pay operating bills in a timely manner.

Calculate After-Tax Cash Flow at disposal : Genetic Insights has a tax rate of 30%. The asset is sold at the end of six years for $4,552. Calculate After-Tax Cash Flow at disposal

Computing the share of stock sell : Storico Co. just paid a dividend of $1.75 per share. The company will increase its dividend by 24 percent next year and will then reduce its dividend growth rat

Discuss whether intangible assets should be recognised : How they should be initially recorded and subsequently amortised in the circumstances - when they are purchased separately from other assets

Draft a money management : Draft a Money Management. NO PLAGIA. Statement of the Problem (SOPs)Course of Action

Calculate the interest rate necessary on the investment : Calculate the interest rate necessary on the investment for you to have $10000 in 8 years. Show calculations and would accept the investment

Imply about the choice between irr and npv : What does this imply about the choice between IRR and NPV? If each of the assumptions were changed (one by one), how would your answer change?

What is the expected rate of return to equity holders : If the ?rm has a 30% tax rate, 12% cost of debt, 19.5% WACC and a 60% debt-asset ratio, what is the expected rate of return to equity holders?

User Account

All Pages