When an intangible asset is acquired by an exchange of assets,which of the following measures will need to be considered in the determination of the cost of the intangible asset?
A)The fair value of the asset given up.
B)The initial cost of the asset given up.
C)The carrying amount of the asset received.
D)The replacement cost of the asset received.

Question

Quizplus · Accepted Answer

When an intangible asset is acquired by an exchange of assets, the cost of the intangible asset will be measured by the fair value of the asset given up, as long as it can be reliably measured. This is in accordance with the International Accounting Standards Board's (IASB) guidance on intangible asset accounting (IAS 38). The initial cost of the asset given up, the carrying amount of the asset received, and the replacement cost of the asset received are not relevant measures in this context.

When an Intangible Asset Is Acquired by an Exchange of Assets,which