Entries of intangible assets investment received by enterprises
Entries of intangible assets investment received are as follows:
Debit: intangible assets
Loan: paid-in capital
capital reserve
What is intangible assets?
intangible assets refer to identifiable non-monetary assets that have no physical form and are owned or controlled by enterprises. It mainly includes patent right, non-patented technology, trademark right, copyright, franchise and so on.
if it meets one of the following conditions, it is considered to be recognizable:
1. It can be separated or divided from the enterprise. And can be used for sale, transfer, licensing, leasing or exchange alone or together with relevant contracts, assets or liabilities.
2. From contractual rights or other legal rights, regardless of whether these rights can be transferred or separated from the enterprise or other rights and obligations.
intangible assets can only be recognized if they meet the following conditions:
1. Economic benefits related to the intangible assets are likely to flow into the enterprise.
2. The cost of this intangible asset can be measured reliably.
what does paid-in capital mean?
paid-in capital refers to all kinds of property invested by investors as capital in an enterprise, which is the source of the total legal capital registered by the enterprise, and it shows the basic property right relationship between the owner and the enterprise. The proportion of paid-in capital is the main basis for enterprises to distribute profits or dividends to investors.
what is capital reserve?
capital reserve refers to the part of an enterprise that the amount of investment received by investors exceeds its share of registered capital (or share capital), as well as the gains and losses directly included in owners' equity. Capital reserve includes capital premium (or equity premium) and gains and losses directly included in owners' equity.
1. The reasons for the formation of capital premium (or equity premium) include issuing shares at a premium and investors' excessive capital contribution.
2. The gains and losses directly included in the owner's equity refer to the gains or losses that should not be included in the current profits and losses, which will lead to the increase or decrease of the owner's equity, and have nothing to do with the owner's investment in capital or the distribution of profits to the owner, including:
(1) When the long-term equity investment of an enterprise is accounted by the equity method, the capital reserve of the investing enterprise is increased or decreased according to its share due to other changes in the owner's equity except the net profit and loss.
(2) if an enterprise implements equity incentive according to the relevant provisions of the state, if the granted equity instruments are cancelled during the waiting period, the enterprise shall immediately include the amount to be confirmed during the remaining waiting period in the current profit and loss, and at the same time confirm the capital reserve.