Caffucino Co. acquired the following assets at the beginning of 2019: a. Paper b
Caffucino Co. acquired the following assets at the beginning of 2019:
a. Paper back copyright to a best seller novel in exchange for 15,000 shares of
Caffucino Co. P100 par ordinary shares. The stock is selling at P225 per share.
b. A fast-food franchise exchange for one hectare of prime real estate. Franchises
of this type are selling for P20,000,000 cash. The land was purchased 10 years
ago for P5,000,000. The franchise has unlimited life if the company maintains the
quality standard of the franchisor.
c. A patent was purchased from the Swift Company for P2,500,000 on January 1,
2019. At that time, Caffucino estimated the remaining life to be 10 years. The
patent was carried on Swift’s book at P150,000 when it sold the patent.
Determine the cost to be recorded for each of the intangible assets acquired.
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