Metro Inc. is one of Canada’s leading food retailers and distributors. It owns and operates a network of supermarkets and pharmacies in Quebec and Ontario under the Metro, MetroPlus, Super C, Food Basics, Adonis, Brunet, and Pharmacy and Drug Basics banners. Exhibit 8.25 shows Metro’s notes on significant accounting policies for intangible assets and goodwill accompanying its 2016 financial statements.
EXHIBIT 8.25 Metro Inc. 2016 Annual Financial Statements; Extract From Note 2

intangible assets
intangible assets with finite useful lives are recorded at cost and are amortized on a straight-line basis over their useful lives. The amortization method and estimates of useful lives are reviewed annually.
Leasehold rights ...........................................................    20 to 40 years
Software ........................................................................    3 to 7 years
Retail network retention premiums ..........................    5 to 30 years
Customer relationships ..............................................    10 years

The banners that the Corporation intends to keep and operate, the private labels for which it continues to develop new products, and the loyalty programs it intends to maintain qualify as intangible assets with indefinite useful lives. They are recorded at cost and not amortized. 

Goodwill

Goodwill, which represents the excess of purchase prices over the fair value of the acquired enterprise’s identifiable net assets at the date of acquisition, is recognized at cost and is not amortized.

Required

a. What major intangible assets does Metro own? Why does the company distinguish between the ones with definite lives and those with indefinite lives?

b. What method does Metro use to amortize its intangible assets? Are they amortized over their legal lives or useful lives? Explain why the treatment is appropriate.

c. Explain what the customer relationships might be related to. How are these related to Metro’s major operations?

d. What is the source of the goodwill that Metro recognizes? Is the goodwill amortized? Explain how Metro determines and recognizes any impairment loss on the goodwill.