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During the year ended July 30, 2016, Cisco Systems, Inc. acquired the following identifiable intangible assets through its purchase of two companies (in thousands): Limited
During the year ended July 30, 2016, Cisco Systems, Inc. acquired the following identifiable intangible assets through its purchase of two companies (in thousands): | |||||||
Limited Lives | Indefinite Lives | ||||||
Technology | Customer Relationships | IPR&D | |||||
Acquired Company (in thousands) | Useful life (in years) | Amount | Useful life (in years) | Amount | Amount | ||
Lancope, Inc | 5 | $79,000 | 6 | $29,000 | $121,000 | ||
Jasper Technologies, Inc | 6 | 240,000 | 7 | 75,000 | 23,000 | ||
Cisco acquired Lancope, Inc. in December 2015, and Jasper Technologies, Inc. in March 2016. Cisco separately tests identifiable intangibles acquired from each company for impairment, and collects the following information to conduct impairment tests at the end of fiscal 2016 (in thousands): | |||||||
Technology | Customer Relationships | IPR&D | |||||
Acquired Company (in thousands) | Sum of expected undiscounted cash flows | Sum of expected discounted cash flows | Sum of expected undiscounted cash flows | Sum of expected discounted cash flows | Sum of expected undiscounted cash flows | Sum of expected discounted cash flows | |
Lancope, Inc | $70,000 | $65,000 | $25,000 | $20,000 | $130,000 | $105,000 | |
Jasper Technologies, Inc | 200,000 | 150,000 | 80,000 | 65,000 | 30,000 | 26,000 | |
Required | |||||||
a. Calculate amortization expense for the above identifiable intangibles for fiscal 2016. Intangibles are amortized on a straight-line basis starting in the month following acquisition. | |||||||
Round answers to the nearest whole number. | |||||||
Enter answers in thousands. | |||||||
Acquired Company | Technology | Customer Relationships | |||||
Lancope, Inc. | $Answer | $Answer | |||||
Jasper Technologies, Inc. | Answer | Answer | |||||
b. Calculate impairment losses for fiscal 2016. | |||||||
Round answers to the nearest whole number. | |||||||
Enter answers in thousands. | |||||||
Acquired Company | Technology | Customer Relationships | IPR&D | ||||
Lancope, Inc. | $Answer | $Answer | $Answer | ||||
Jasper Technologies, Inc. | Answer | Answer | Answer | ||||
c. Determine the amounts reported on Ciscos fiscal 2016 balance sheet for technology, customer relationships, and in-process R&D. | |||||||
Round answers to the nearest whole number. | |||||||
Enter answers in thousands. | |||||||
Amounts reported on Cisco's fiscal 2016 balance sheet | |||||||
Technology | $Answer | ||||||
Customer Relationships | Answer | ||||||
IPR&D | Answer | ||||||
Consolidation Working Paper, Three years after acquisition | |||||||
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