320CheckFigures_12 - book value amount (which is equal to...

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CHAPTER 12 Intangible Assets BRIEF EXERCISE 12-2 Costs incurred successfully defending a patent/copyright lawsuit are capitalized as part of the intangible asset and a new amortization calculation determines the amount to be amortized during the current and future periods. EXERCISE 12-15 The implied value of goodwill is found by comparing the current fair value of the division with fair value of the identifiable net assets. The problem says that book value and fair value are identical. To find the fair value of identifiable assets, use the
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Unformatted text preview: book value amount (which is equal to fair value) and subtract out the goodwill (since it is not identifiable and the implied value of it is what we are trying to find). This implied goodwill value is then compared with the carrying amount of goodwill to determine the impairment. Reversals of goodwill impairment are not allowed. EXERCISE 12-17 Materials purchased for future R&D projects should be recorded as assets (like supplies). They will be expensed to R&D when used in the R&D process. 10-1...
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This note was uploaded on 11/22/2010 for the course ACCT 320 taught by Professor Alee during the Spring '10 term at Kansas State University.

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