Because a wireless license does not exist physically, Verizons (VZ) wireless licenses are intangible assets. All of

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Because a wireless license does not exist physically, Verizon’s (VZ) wireless licenses are intangible assets. All of the costs of acquiring a wireless license should be recorded as an asset. In a recent year, Verizon reported almost $95.1 billion of wireless licenses, representing 33% of its total assets.
Even though the FCC license is granted for a 10-year period, Verizon considers this license to have an indefinite useful life. This is because the license is subject to renewal at a low cost and, historically, the FCC has renewed Verizon’s licenses.
Verizon does not expense (amortize) the cost of its wireless licenses. Instead, the licenses are reviewed for any impaired value.

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Financial And Managerial Accounting

ISBN: 9780357714041

16th Edition

Authors: Carl S. Warren, Jefferson P. Jones, William Tayler

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