Heflin Corporation has been amortizing its finite-life intangible assets over their legal lives. The company's accountant argues

Question:

Heflin has been amortizing its finite-life over their legal lives. The company's accountant argues that this is appropriate because an intangible asset's legal life is known with certainty, but the useful life of an intangible asset is subjective.
(a) Why is this not correct?
(b) What impact might using the legal life instead of the useful life have on the company's financial statements?
Intangible Assets
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... Corporation
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