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7 November, 00:53

Johan Co. has an intangible asset, which it estimates will have a useful life of 10 years, while Abco Co. has goodwill, which has an indefinite life. Which company should report amortization in its financial statements

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  1. 7 November, 01:14
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    Johan Co.

    Explanation:

    Since in the question it is given that the Johan Co. has an intangible asset and we already know that on an intangible asset, the amortization expense is charged whereas on the other side the Abco Co has goodwill on which the impairment is charged

    So, in the given scenario, the amortization should be reported on Johan Co financial statements only
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