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Accounting treatment of copyright, trademark, intangible assets

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Epad-Books Ltd has purchased the following intangible assets in separate
transactions:

a A copyright of a novel which expires after 35 years. The company intends to use this copyright for 25 years and it is expected to be ofno value at that time.

b A trademark relating to a health product. This trademark has unlimited legal life but the company expects to cease manufacture of
this health product within four years.

c A patent of special binding technology which expires after 10 years. The company expects to make use of this patent for seven years andthen dispose of it.

Required:
For each of the intangible assets, determine their useful life. Assuming that the company does not use the revaluation model, explain how each asset should be treated in the company's financial statements.

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Solution Summary

The expert examines accounting treatments of copyright, trademark and intangible assets. The copyright of a novel is determined.

Solution Preview

a. the copyright has a useful life of 25 years.
b. the trademark has a useful life of 4 years.
c. the patent ...

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