ExpertEasy1 markMultiple Choice
CPA · Question 24 · Area II: Technical Accounting
Which of the following intangible assets is NOT subject to amortization?
Which of the following intangible assets is NOT subject to amortization?
Answer options:
A.
A patent with a remaining legal life of 12 years.
B.
A trademark determined to have an indefinite useful life.
C.
Customer lists with a 5-year expected economic benefit.
D.
Copyrights.
How to approach this question
Distinguish between finite and indefinite useful lives. Only indefinite are not amortized.
Full Answer
B.A trademark determined to have an indefinite useful life.✓ Correct
B
ASC 350 states that intangible assets with indefinite useful lives are not amortized. Instead, they are tested for impairment at least annually.
Common mistakes
Assuming all intangibles are amortized.
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