Question
Identifiable Intangibles and Goodwill, U.S. GAAP International Foods, a U.S. company, acquired two companies in 2013. As a result, its consolidated financial statements include the
Identifiable Intangibles and Goodwill, U.S. GAAP
International Foods, a U.S. company, acquired two companies in 2013. As a result, its consolidated financial statements include the following acquired intangibles:
Intangible Asset | Date of Acquisition | Fair Value at Date of Acquisition | Useful Life |
---|---|---|---|
Customer relationships | January 1, 2013 | $2,400,000 | 5 years |
Favorable leaseholds | June 30, 2013 | 4,800,000 | 6 years |
Brand names | June 30, 2013 | 10,800,000 | Indefinite |
Goodwill | January 1, 2013 | 300,000,000 | Indefinite |
Goodwill was assigned to the following reporting units:
Asia | $60,000,000 |
South America | 90,000,000 |
Europe | 150,000,000 |
Total | $300,000,000 |
It is now December 31, 2014, the end of International Foods' accounting year. No impairment losses were reported on any intangibles in 2013. Assume that International Foods bypasses step 0 of the goodwill impairment test. The following information is available on December 31,2014:
Intangible Asset | Sum of Future Expected Undiscounted Cash Flows | Sum of Future Expected Discounted Cash Flows |
---|---|---|
Customer relationships | $720,000 | $540,000 |
Favorable leaseholds | 3,600,000 | 2,640,000 |
Brand names | 8,400,000 | 4,200,000 |
Reporting Unit | Unit Carrying Value | Unit Fair Value |
---|---|---|
Asia | $180,000,000 | $240,000,000 |
South America | 120,000,000 | 210,000,000 |
Europe | 360,000,000 | 300,000,000 |
Compute 2014 amortization expense and impairment losses on the above intangibles, following U.S. GAAP.
Enter answers in millions, using decimal places when applicable.
(in millions) | |
---|---|
Amortization expense - identifiable intangibles | Answer |
Impairment losses - identifiable intangibles | Answer |
Goodwill impairment loss | Answer |
Total | Answer |
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