Say you buy 5,000 Libras. What’s the journal entry? How to you account for the Libras after you buy them?
Dunkin’ Donuts plans to spend $100 million on “brand refresh.” DD does not own any of the stores, rather DD uses the franchise model. How will DD account for the amounts of the brand refresh that is spent on 1) equipment 2) technology infrastructure 3) training? Capitalize? Expense?
What accounting measurement and reporting issues are particularly applicable to firms with fewer fixed assets?
IKEA has estimated its brand value to be about $11 billion. Should the company debit “intangible asset” and credit “APIC”? Or, credit “gain”? Or, do nothing? What do you recommend and why?
At the front of Tiffany’s 10-K (for fiscal 2011), TIF states “The TIFFANY & CO. brand (the “Brand”) is the single most important asset of Tiffany . . . ” However, TIF does not list its Brand on its balance sheet. Why not?
Who cares, and why do they, whether intangibles are expensed or capitalized? What is the downside of capitalization?
