NueNews Bhd. (NNB) is a company that broadcasts and publishes news. NNB specialises in gathering and broadcasting the national news. NNB also publishes news related to the local stars and celebrities on a daily online magazine. However, NNB's main revenue from publishing is earned from their monthly printed magazine called "Bintang Buzz" that shows the latest fashion worn by the local stars and celebrities that month. NNB owns the copyright for Bintang Buzz since the year 2009. Due to the popularity of Bintang Buzz, NNB has become a recognised name among Malaysians. Also, the teenagers and young adults prefer to subscribe to NNB's online website compared to any other online magazine At the beginning of January 2015, NNB purchased 3 helicopters, which costs RM 1,500,000 each. NNB needed the helicopters to cover the news more efficiently. NNB had to pay RM 18,000 for a permit allowing NNB to fly the helicopters in Malaysian skies. NNB had to incur additional costs of RM 60,000 to have speciality glass windows fixed on all 3 helicopters to reduce reflection from sunlight so that they could use their cameras to record the news more clearly from inside the helicopters. The useful life of the helicopters is 30 years. The expected residual value at the end of the useful life is RM 2,160,000 for all 3 helicopters. Required: a. Based on the above, identify two (2) intangible assets of NNB (2 marks) and state whether each of the intangible assets that you have identified should be recognised by NNB (2 marks). Provide a brief explanation to support your answer of whether each specific intangible asset should be recognised or should not be recognised. (4 marks) [8 marks] b. Using the straight line depreciation method, calculate the annual depreciation of the 3 helicopters AND calculate the net book value of the helicopters as at year ends on 31 December 2015 and 31 December 2016, respectively. [6 marks] c. In order to access the online magazine, customers are required to pay subscription fees in advance. The subscription can be on a monthly or yearly basis. Once the customers make payment, they are granted access to view the online magazine. Customers are allowed to cancel their subscription at any time by contacting and notifying NNB, When there is a cancellation of subscription, the remainder of the amount of subscription fees is returned to the customer. Required: Considering the circumstances above, discuss when revenue should be recognised. Explain why revenue should be recognised at that point. [4 marks] Total - 18 marks
