On 1 April 2017 the company purchased a 10-year exclusive licence to sell a luxury cosmetic product.

However, on 1 October 2018 it was discovered that an ingredient within the product was toxic, this was published on social media and it was now considered that the licence was impaired. On 1 October 2018 the Directors estimated that the resale value of the licence was £10,000 and the Value in use was £15,000. Any adjustments are processed through COS expense. (Round any calculations to the nearest pound).

Licence – Cost (Note 5)	60,000
Licence – Amortisation at 1 April 2018		6,000

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