Question
Which of the following assets would be subject to impairment tests after they are acquired? (check all that apply)
Brand name
Patents
Customer Lists
Goodwill
Copyrights
1 point
7.
Question 7
Wh
Brand name
Patents
Customer Lists
Goodwill
Copyrights
1 point
7.
Question 7
Wh
Answers
GPT-4o mini
In general, the following assets are subject to impairment tests after they are acquired:
1. **Goodwill** - Goodwill is specifically subject to annual impairment tests and tested for impairment at least annually or more frequently if events or changes in circumstances indicate that it might be impaired.
2. **Brand name** - If the brand name has an indefinite useful life, it would be subject to impairment testing. However, if it is considered to have a finite useful life, it would be amortized and then also tested for impairment when there are indicators of potential impairment.
3. **Patents** - Patents with a finite useful life are amortized, but they are also subject to impairment tests when there are indicators of potential impairment. Patents with indefinite lives would be subject to annual impairment tests.
4. **Customer Lists** - Customer lists with a finite useful life would also be amortized and then subject to impairment testing if indicators of impairment arise.
5. **Copyrights** - Copyrights with a finite useful life are amortized and may be tested for impairment if there are indicators of potential impairment. Copyrights with indefinite lives would be subject to annual impairment testing.
In summary, typically **Goodwill**, **Brand names** (if indefinite), **Patents** (if indefinite), **Customer Lists** (if indefinite), and **Copyrights** (if indefinite) would be subject to impairment testing, while **Patents**, **Customer Lists**, and **Copyrights** with finite lives would be amortized but also tested for impairment if needed.
Therefore, all listed assets have conditions under which they could be subject to impairment tests. However, the categorization will often depend on whether they are considered finite or indefinite lives.
So, the final answer would be:
- Brand name
- Patents
- Customer Lists
- Goodwill
- Copyrights
Check all that apply.
1. **Goodwill** - Goodwill is specifically subject to annual impairment tests and tested for impairment at least annually or more frequently if events or changes in circumstances indicate that it might be impaired.
2. **Brand name** - If the brand name has an indefinite useful life, it would be subject to impairment testing. However, if it is considered to have a finite useful life, it would be amortized and then also tested for impairment when there are indicators of potential impairment.
3. **Patents** - Patents with a finite useful life are amortized, but they are also subject to impairment tests when there are indicators of potential impairment. Patents with indefinite lives would be subject to annual impairment tests.
4. **Customer Lists** - Customer lists with a finite useful life would also be amortized and then subject to impairment testing if indicators of impairment arise.
5. **Copyrights** - Copyrights with a finite useful life are amortized and may be tested for impairment if there are indicators of potential impairment. Copyrights with indefinite lives would be subject to annual impairment testing.
In summary, typically **Goodwill**, **Brand names** (if indefinite), **Patents** (if indefinite), **Customer Lists** (if indefinite), and **Copyrights** (if indefinite) would be subject to impairment testing, while **Patents**, **Customer Lists**, and **Copyrights** with finite lives would be amortized but also tested for impairment if needed.
Therefore, all listed assets have conditions under which they could be subject to impairment tests. However, the categorization will often depend on whether they are considered finite or indefinite lives.
So, the final answer would be:
- Brand name
- Patents
- Customer Lists
- Goodwill
- Copyrights
Check all that apply.