subsi’s intangible assets written off at acqui date

To answer the second part of your question first, the 500,000 is deducted from the net assets as at date of acquisition because, per the question, “Picant’s directors believed the software to have no recoverable value at the date of acquisition” so it’s a fair value adjustment.

Because it has been written off in the post-acquisition period, the post-acq profits have been decreased whereas the 500,000 should have been written off the pre-acq profits. So, at the same time as we are decreasing the pre-acq for the purposes of the goodwill calculation, we should also be increasing the post-acq ie, we are simply reallocating the expense from the post-acq to the pre-acq period