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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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Solution Summary

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

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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 ...

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