Use the same information from E12- 4 but now treat SMC Research Associates as an IFRS reporter.
Question:
In E 12 - 4
Required
a. Compute the impairment loss ( if any) for each intangible asset.
b. Prepare the journal entry necessary to record the impairment loss.
c. Assuming that SMC amortizes its finite- life intangible assets by using the straight- line method, with no scrap value, prepare the journal entry to record the annual amortization for the first year subsequent to the impairment write- down.
An intangible asset is a resource controlled by an entity without physical substance. Unlike other assets, an intangible asset has no physical existence and you cannot touch it.Types of Intangible Assets and ExamplesSome examples are patented...
Transcribed Image Text:
Intangible Asset Franchise Patent Trada name Net Carrying Value S 850,000 Remaining Life 5 years 3 years NIA 400,000 3,950,000 $5.200,000 Total Future Period Year 1 Year 2 Year 3 Year 4 Year 5 Total Franchise $300,000 220.000 110,000 45,000 25,000 $700,000 Patent Trade Name $280,000 $ 800,000 610,000 590,000 510,000 365,000 90,000 $380,000 2.875,000
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a First determine that evidence and circumstances indicated that impairment is likely Then perform the onestep impairment test with the two parts Part ...View the full answer
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Related Book For
Intermediate Accounting
ISBN: 978-0132162302
1st edition
Authors: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
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