Estimated total future cash flows from the trade name are P13,000 on January 4, 2011. 2009
Aeli Corp. obtained a trade name in January 2009, incurring legal costs of P15,000. The company amortizes the trade name over 8 years. Aeli successfully defended its trade name in January 2010, incurring P4,900 in legal fees. At the beginning of 2011, based on new
2009
Dec. 31 Amortization Expense - Trade Name ________
2010
Dec. 31 Amortization Expense – Trade Name _________
2011
Dec. 31 Loss on Impairment _________
Total future cash flows 13,000
Therefore, an impairment loss has occurred
Carrying value = _______
Fair value = (12,000)
2011
Dec. 31 Amortization Expense – Trade Name _______
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