2016-12-02 00:00:00Finance and AccountingEnglishIntangible assets have no physical form and can be divided into two categories. Find out what they are and how they are reported.https://quickbooks.intuit.com/ca/resources/ca_qrc/uploads/2017/03/business-card-name-inantigble-asset.jpghttps://quickbooks.intuit.com/ca/resources/finance-accounting/what-are-intangible-assets/What Are Intangible Assets?

What Are Intangible Assets?

0 min read

Intangible assets are assets with no physical form. For example, trademarks, brand names and technologies are considered intangible assets.

Intangible assets can be definite or indefinite. Definite intangible assets belong to a business for a specified duration of time. For example, patents are definite intangible assets because they’re only valid for a period of time. The brand name of a business is an infinite intangible asset, as it belongs to the business forever.

When a business reports an intangible asset, it adds up all the costs incurred to create or purchase the asset. For example, a company pays $20,000 to develop a technology. To patent this technology, it pays $5,000 to hire a patent lawyer. Therefore, the expenses associated with this patent are $25,000, even when the asset may be worth $1 million.

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

Related Articles

Classifying Assets on Balance Sheet

A balance sheet is a standardized financial statement that typically looks similar…

Read more

How to Prepare a Balance Sheet

A balance sheet is a picture of your company’s net worth at…

Read more

Strategies for Shielding Canadian-Owned U.S. Assets From U.S. Estate Tax

As of 2018, the U.S. estate tax applies to all assets over…

Read more