Answered: Describe the Costs of Defending…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 1Q: What is the difference between tangible and intangible assets?

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Describe the Costs of Defending Intangible Rights.

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Step 1

Introduction

Intangible assets are the assets that cannot be seen physically, but its' presence in business have great value. These assets are non-current as well as non-monetary in nature too. Intangible assets are of 2 types -

Legal Intangible Assets - thses are IPR (Intellectual Property Rights) such as Copyrights, Trademarks etc.
Competitive Intangible Assets - these are customer loyality, structural activities, leverages etc which is earned with the help of companys' performance and through human capital.

Few Costs that may arise for defending intangible rights are mentioned below -

Cost incurred during purchase of such rights, Legal fees if someone misuse the right (eg. Patent infringement, Copyright infringement), reserach and development costs, insurance etc.

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