Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

nternational 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

nternational 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 $6,400,000 5 years
Favorable leaseholds June 30, 2013 12,800,000 4 years
Brand names June 30, 2013 28,800,000 Indefinite
Goodwill January 1, 2013 800,000,000 Indefinite

International Foods reports using IFRS and allocating its goodwill to the following cash gathering units (CGUs):

E. Asia $64,000,000
Indonesia 96,000,000
Brazil 240,000,000
Mediterranean 240,000,000
Scandanavia 160,000,000
Total $800,000,000

The following information is available at December 31, 2014:

Intangible Asset Sum of Future Expected Undiscounted Cash Flows Sum of Future Expected Discounted Cash Flows
Customer relationships $1,920,000 $1,440,000
Favorable leaseholds 9,600,000 7,040,000
Brand names 22,400,000 11,200,000

CGU Unit Book Value Unit Fair Value
E. Asia $320,000,000 $240,000,000
Indonesia 160,000,000 192,000,000
Brazil 208,000,000 224,000,000
Mediterranean 352,000,000 304,000,000
Scandinavia 480,000,000 368,000,000

Unit book values are already adjusted for appropriate 2014 amortization and impairment of identifiable intangibles.

Compute

014 amortization expense and impairment losses on the above intangibles, following IFRS.

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

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managerial Accounting Tools for Business Decision Making

Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso, Ibrahim M. Aly

4th Canadian edition

1118856996, 978-1118856994

More Books

Students also viewed these Accounting questions