1. Patent—an exclusive right granted to its owner to produce and
sell a patented item or to use a process for 20 years. Costs of
research and development leading to a new patent are expense
2. Copyright—the exclusive right to publish and sell a musical,
literary, or artistic work during the life of the creator plus 70
3. Franchises and Licenses—rights that a company or
government grants an entity to deliver a product or service
under specified conditions. If agreement is for indefinite or
perpetual period, costs are not amortized.
4. Trademarks and Trade Names—symbols, names, phrases, or
jingles identified with a company, product, or service.
5. Goodwill—specific meaning in accounting: the amount by
which the value of a company exceeds the value of its
individual assets and liabilities. Implies the company as a
whole has certain valuable attributes not measured among its
individual assets and liabilities. Goodwill is measured as the
excess of cost of an acquired entity over the valuable of net
assets acquired. Not recorded unless an entire company or
business segment is purchased. It is not amortized but is tested
annually for impairment.
6. Leasehold—the rights to possess and use leased property
granted by the property’s owner (lessor) to the lessee in a
contract called a lease. Recorded, if there was a cost involved,
as an intangible asset by the lessee (or sublessee). As
Leaseholds are amortized, the cost is charged to Rent Expense.
7. Leasehold improvements—alterations or improvements to
leased property, such as partitions, painting, and storefronts.
Amortization results in debit to Amortization Expense—