Page 28 - FINAL CFA I SLIDES JUNE 2019 DAY 8
P. 28
Session Unit 8:
29. Long-lived Assets
LOS 29.f: Describe the different amortisation methods for intangible assets with finite lives and calculate
amortisation expense., p.220
The same methods, straight-line, accelerated, and units-of-production, are permitted.
Calculation of amortization also requires estimates of useful lives and salvage values:
• Estimation complicated by many legal, regulatory, contractual, competitive, and economic factors that
may limit the use of the intangible assets.
.
tanties
The patent expires in 12 years. The franchise agreement expires in 7 years but can be renewed indefinitely at a minimal
cost. The copyright is expected to be sold at the end of 20 years for $30,000. Use the straight-line amortization method
to calculate the total carrying value of Brandon’s intangible assets at the end of the year.
