The following intangibles have been identified for an acquired company. Which one(s) are most likely to be separately capitalized by the acquiring company, per ASC Topic 805?
•Developed technology
•Skilled workforce
•Brand names
•Prospective contracts

Question

Quizplus · Accepted Answer

Developed technology and brand names are identifiable intangible assets that can be separately capitalized under ASC Topic 805 because they can be separately identified and have a measurable future economic benefit. A skilled workforce is not considered an identifiable intangible asset for separate capitalization because it is not separable or arises from contractual or other legal rights. Prospective contracts are not recognized until they are finalized and meet the criteria for recognition.

The Following Intangibles Have Been Identified for an Acquired Company