Intangible Assets - Intangible Assets Intangible assets are...

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Intangible Assets Intangible assets are rights, privileges, and competitive advantages that result from ownership of long-lived assets that do not possess physical substance. Many companies' most valuable assets are intangible. Some widely known intangibles are Microsoft's patents, McDonalds's franchises, the trade name iPod, and Nike's trademark “swoosh.” Analysts estimated that in the early 1980s the market value of intangible assets to total assets was close to 40%. By 2000, the percentage was over 80%— quite a difference. What has happened is that research and development (e.g., hi-tech and bio-tech) has grown substantially. At the same time, many companies (e.g., Nike and Gatorade) have developed brand power which enables them to maintain their market position. As you will learn in this section, financial statements do report numerous intangibles. Yet, many other financially significant intangibles are not reported. To give an example, according to its 2007 financial statements, Google had total stockholders' equity of $22.7 billion. But its
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This note was uploaded on 11/08/2011 for the course ACCOUNTING ac 201 taught by Professor - during the Spring '11 term at Montgomery.

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