Assignment of account

1 answer below »

074c369a-6fb3-4f8b-8fe9-56fc8d180b09-duov1lt3.png 1c6bd7ed-54d4-467b-915b-fba997ed769c-ojiwslz0.png

Answered Same Day Sep 12, 2021

Solution

Preeta answered on Sep 15 2021

163 Votes

Question 1:
Brands grow their goodwill over time. For example: the formula of Coca-cola has proved to be more valuable over the time. The same thing goes for the formula of Scotch Whiskey as well. These are considered as
and equity which is a type of intellectual property for the company and so need to be considered as intangible asset. AASB 138 is considered with the intangible asset (AASB 2007). Most of the time goodwill is internally generated by a company. The standard does not allow internally generated goodwill to be recognized as intangible asset and state them in financial accounting since it is difficult to identify them. Goodwill can only be recognized when it has been acquired as a part of business combination or directly purchased that is a certain prices can be put against that (Cheung et al. 2008).
Such formulas are part of
and equity and although have been developed through research yet has reached its maturity value long time ago and stays with the company as long as the company continues its operation. So, in a way these are the intangible assets of a company yet are difficult to assign value against such intangible assets. Some time the
and values are to be recognized since they add a value to the company but there are also some cases where the
and value does not add much to the value of the company. So, standard setters face difficulty in allowing recognition of
and and formulas in the financial statement of the company to depict the co
ect financial position.
Question 2:
(a) Under AASB 136, goodwill can be either acquired separately or as a part of the business combination or in exchange of other assets. Goodwill is recognized only under the following two conditions:
· There is certainty about the economic benefit in the future.
· The cost of the goodwill can be measured reliably.
AASB 138 contains provisions regarding the impairment of assets (AASB 2010). The standard mentions that the intangible assets need to be ca
ied at their realizable value and so if it is realized that the value of intangible asset has been reduced, so they need to be reduced to the realizable value, the...

SOLUTION.PDF

Assignment of account

Solution

Answer To This Question Is Available To Download

Related Questions & Answers

Submit New Assignment