ECONOMICS

Detailed explanation-1: -Amortization of intangibles, also simply known as amortization, is the process of expensing the cost of an intangible asset over the projected life of the asset for tax or accounting purposes. Intangible assets, such as patents and trademarks, are amortized into an expense account called amortization.

Detailed explanation-2: -Like depreciation, there are multiple methods a company can use to calculate an intangible asset’s amortization, but the simplest is the straight-line method. With the straight-line method, the company starts with the asset’s recorded value, its residual value, and its useful life.

Detailed explanation-3: -6.7 Amortisation is the systematic allocation of the depreciable amount of an intangible asset over its useful life. 6.8 Depreciable amount is the cost of an asset less its residual value. 6.9 Useful life is either: (a) the period of time over which an asset is expected to be used.