Red Bear Ltd purchased several intangible assets as

follows Asset Purchase Cost Licence #3762

Red Bear Ltd. purchased several intangible assets, as follows:Asset Purchase
CostLicence……………………………… $ 80,000Customer list………………………... 60,000Patent………
160,000Copyright………………………………. 250,000The following information is also available:• In add
to the costs listed above, there were legal fees of $12,000 associated with the licence
acquisition. The licence is valid in perpetuity, and sales of the products produced under the
licence have been strong and are expected to continue at the same level for many decades.•
The customer lists are expected to be useful for the next six years.• The patent has a legal life
of 20 years, but technological changes are expected to render it worthless after about eight
years.• The copyright is good for another 40 years, but nearly all the related sales are expected
to occur during the next 10 years.Required:a. Calculate the annual depreciation expense, if any,
that should be recorded for each of these intangible assets.b. Show how the intangible assets
section of the statement of financial position would be presented four years after acquisition of
these assets, assuming that there has been no evidence that their values have been impaired.
Assume that a full year of depreciation was taken in the year of acquisition.View Solution:
Red Bear Ltd purchased several intangible assets as follows Asset Purchase Cost Licence

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