Notes Ch 11

Notes Ch 11 - Jorge Rossello Busi 100 Chapter 11 Notes I.

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Jorge Rossello Busi 100 Chapter 11 Notes I. Identifying/Accounting for Intangible Assets a. Intangible Asset: An asset lacking physical substance that is expected to help generate future revenues for more than one year; common examples are patents, copyrights, trademarks. b. Amortization: A mechanically derived pattern allocating an intangible asset’s cost to expense over the shorter of the legal life or useful life; it is the equivalent of depreciation but related to intangible assets. i. Typically, Annual Amortization = Historical Cost / Life of Asset ii. In adjusting for annual amortization, debit amortization expense and credit the asset directly. c. Goodwill: The price paid by one company to acquire another that is in excess of the fair value of the net identifiable assets and liabilities of the other company; it is often associated with intangibles that cannot be recognized. i. Debit Goodwill when company pays extra amount because intangibles are present that have value but do not meet the criteria for separate reporting. ii.
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This note was uploaded on 04/26/2011 for the course BUSI 100 taught by Professor Unknown during the Spring '07 term at UNC.

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Notes Ch 11 - Jorge Rossello Busi 100 Chapter 11 Notes I.

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