Explain how the cost of an intangible asset is determined

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Reference no: EM13872217

Purpose: This case will review the six major categories of intangible assets and will discuss the guidelines for determining the cost of an intangible asset.

A classified balance sheet will report a company's current assets followed by long-term investments, property, plant and equipment, and intangible assets.

Required:

(a) Describe the two main characteristics of an asset to be classified as an intangible asset on the balance sheet.

(b) List and describe the six major categories of intangible assets. Give examples of each.

(c) Explain how the cost of an intangible asset is determined.

(d) Explain how to determine whether an intangible asset is to be amortized or not amortized.

Reference no: EM13872217

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