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Hi John,
Sorry about all these questions.. have an exam tmw and I’m doing a revision!
The tangible assets are shown in the balance sheet at the cost amount, no matter the accumulated depreciation, right? Are the intangible assets shown differently? I mean, It is shown the cost less depreciation? I was just doing a question which the answer for the total intangible asset in the SFP is the cost less depreciation.
Another question but in relation to the above… the Accumulated Depreciation for a building, for example, is not shown in the Statement of Financial Position, is it? Or would it be disclosed as a note only?
The only intangible assets that you could see in F3 are purchased goodwill and development expenditure.
Purchased goodwill is not depreciated (instead it should be revalued each year – but you cannot be asked to deal with this in F3).
Development expenditure should be amortised (which means the same as depreciation) over the period that they expect to be receiving income from whatever it relates to.
With regard to accumulated depreciation, it has to be show somewhere but it can be on the face of the SOFP or instead you can just show the carrying value on the SOFP and the detail (cost less accumulated depreciation) as a note. This will not be a problem in the exam – if there are numbers then it will be made clear what to do.
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