Identifying and Accounting for Intangible Assets

oin each of these three areas. ing and Accounting for Intangible Assets On the first Identilsay of 2016, Holthausen Company acquired the assets of Leftwich Company includn LO1, 5 t day of 2016, Holthausen Company acquired the assets of Leftwich Comp ral intangible assets. These include a patent on Leftwich's primary product, a device c entiscope. Leftwich carried the patent on its books for $1,500, but Holthausen believes that t any including fair value plentsheis $200,000. The patent expires in seven years, but competitors can be expec ted to d ompeting patents within three years. Holthausen believes that, with expected technologica velop cor vements, the product is marketable for at least 20 years. The improvem registration of the trademark for the Leftwich name is scheduled to expire in 15 y he Leftwich brand name, which Holthausen believes is worth $500,000, could However, t tied to related products for many years beyond that. be ap- As part of the acquisition, Leftwich's principal researcher left the company. As part of the acquisition, he signed a five-year noncompetition agreement that prevents him from developing competing products. Holthausen paid the scientist $300,000 to sign the agreement. What amount should be capitalized for each of the identifiable intangible assets? What amount of amortization expense should Holthausen record in 2016 for each asset? b