Examples of intangible assets
/An intangible asset is a non-physical asset having a useful life greater than one year. These assets are generally recognized as part of an acquisition , where the acquirer is allowed to assign some portion of the purchase price to acquired intangible assets. Few internally-generated intangible assets can be recognized on an entity's balance sheet . Examples of intangible assets are noted below.
Marketing-Related Intangible Assets
-
Trademarks
-
Newspaper mastheads
-
Internet domain names
-
Noncompetition agreements
Customer-Related Intangible Assets
-
Customer lists
-
Order backlog
-
Customer relationships
Artistic-Related Intangible Assets
-
Performance events
-
Literary works
-
Musical works
-
Pictures
-
Motion pictures and television programs
Related AccountingTools Courses
Contract-Based Intangible Asset
-
Licensing agreements
-
Service contracts
-
Lease agreements
-
Franchise agreements
-
Broadcast rights
-
Employment contracts
-
Use rights (such as drilling rights or water rights)
Technology-Based Intangible Asset
-
Patented technology
-
Computer software
-
Trade secrets (such as secret formulas and recipes)
Accounting for Intangible Assets
Intangible assets may be recorded if they are acquired, but not if they are developed in-house. If acquired, an expenditure can only be recorded as an asset if it is expected to have a useful life of at least one year. Otherwise, it must be recorded at once as an expense . For example, if a business pays a graphic artist to design a logo for it, then the artist’s fee can be recorded as an intangible asset. If the logo had been designed in-house by a staff person, it would not be possible to record an asset.