IAS 38 – Intangible Assets

At 30 September 20X9, Sandown Co’s trial balance showed a brand at cost of $30 million
and accumulated amortisation on that brand brought forward at 1 October 20X8 of $9
million. Amortisation is based on a 10-year useful life. An impairment review on 1 April 20X9
concluded that the brand had a value in use of $12 million and a remaining useful life of
three years. However, on the same date, Sandown Co received an offer to purchase the
brand for $16 million and costs of $1m would be incurred in legal fees associated with the
sale. What should be the carrying amount of the brand in the statement of financial position of
Sandown Co as at 30 September 20X9?

Well… this question has given me a bit of a crunch now. I understand that we have to look for the greater of value in use and Fairvalue less costs to sell. which is 15m (16 000 – 1000). Which is obviously greater that our Value in use of 12 000.

The depreciation bit is where it gets kind tricky for me. Kindly offer an elaborate explanation as this would help me a lot.