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    Intangible assets

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    What are the two main characteristics of intangible assets and how does the handling of cost allocation differ?

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    Intangible Asset
    Item lacking physical substance (e.g., goodwill) or representing a right granted by the government (e.g., patent, trademark) or by another company (e.g., franchise). Intangibles have a life in excess of one year. Limited life intangible assets are amortized into expense over the period benefitted. Unlimited life intangibles are subject to a yearly impairment test.
    Intangible assets are defined as those non-monetary assets that cannot be seen, touched or physically measured and which are created through time and/or effort. There are two primary forms of intangibles - legal intangibles (such as trade secrets (e.g., customer lists), copyrights, patents, trademarks, and goodwill) and competitive ...

    Solution Summary

    The solution discusses the two main characteristics of intangible assets and how each one treats the handling of cost allocation.