[Excited_CPA]

Hi all,

Quick question about intangible assets. In one of the practice questions I was working on, they expensed all of the fees (purchase price + acquisition costs + legal fees) that were used on a patent that was unsuccessfully defended in court.

Is this correct? By expensing all the costs, it seems like we’re saying that the patent is worthless. Shouldn’t you only expense the legal fees related to the unsuccessful defense and test this intangible asset for impairment?

Thanks for the help in advance,

BEC 04/14/12 87
FAR 08/28/12 88
AUD 10/06/12 94
REG 02/09/13 91

[Anonymous]

yes, that's correct. if the patent can't be defended in court, it's worthless

[Anonymous]

yes, that's correct. if the patent can't be defended in court, it's worthless

[Anonymous]

Its capitalized only if successfully defended, otherwise it doesnt add value to the patent

[Anonymous]

Its capitalized only if successfully defended, otherwise it doesnt add value to the patent

[Author]

Replies