Distribution licence

Generally 1 mark for each matter considered/evidence point explained:

Matters:

– Materiality of the asset (calculation)
– Identify event as intangible asset that should be capitalised
– Identify that no amortisation has been charged
– The non-amortisation is not material

Evidence:

– A copy of the licence
– Agreement of cost to bank statement and cash book
– Discussion with management regarding the non-amortisation
– Sales records of the soft drink since 1 September 2012

Maximum marks 5