IP Ltd reports the following intangible assets:

Patents were acquired at a cost of $80 million and were revalued soon afterwards. They have an estimated life of 16 years, of which 12 years remain.

The trademark can be renewed indefinitely, subject to continued use. The cost represents registration fees, which were initially expensed but recognised five years later after the trademark had started to become recognised by consumers.

Goodwill has been purchased and amortised on a straight-line basis. The brand name is stated at fair value and is internally generated.

The licence has a 10-year life of which nine years remain. The licence can be traded in an active market and has a fair value of $17 million.

REQUIRED

1. State how each asset, or class of assets, should be reported in accordance with AASB 138.

2. Apply AASB 138 and state the carrying amount and whether each asset/asset class should be amortised. Specify any choice of methods permitted for IP Ltd.

Transcribed Image Text:

$m 160 (40). 120 Trademarks, at cost 15 Goodwill, at cost 50 less Accumulated amortisation (10) 40 Patents at fair value less Accumulated amortisation Brand name Licence at cost less Accumulated 100 10 amortisation (1) 9