Intangible assets include patent rights, trademark rights, etc. If the intangible assets are not expected to bring economic benefits to the enterprise, they should be scrapped and written off. How to prepare the accounting entries for the scrapping of intangible assets?
Accounting entries for scrapping of intangible assets
Debit: Accumulated amortization
Provision for impairment of intangible assets
Non-operating expenses—— Loss on disposal of non-current assets
Credit: Intangible assets
What is the provision for impairment of intangible assets?
The "Provision for Impairment of Intangible Assets" account is an asset account and is used to calculate the provision for impairment of an enterprise's intangible assets, and should be accounted for in detail according to the items of intangible assets.
If an intangible asset is impaired on the balance sheet date, the amount that should be written down shall be debit: asset impairment loss
Credit: intangible asset Impairment Provision
The ending credit balance of the "Intangible Asset Impairment Provision" account registers the intangible asset impairment provision that has been accrued by the enterprise but has not yet been written off.
The provision for impairment of intangible assets made by the enterprise is a contingent expenditure and does not comply with the principle of certainty. Therefore, it cannot be deducted before income tax and should be treated as a tax adjustment and increase.
What are non-operating expenses?
Non-operating expenses refer to various non-operating expenses other than main business costs and other business expenses, including but not limited to fines, donations, extraordinary losses, etc.
The "Non-operating expenses" account is a profit and loss account. It accounts for various non-operating expenses incurred by the enterprise and is debited. At the same time, detailed accounts should be set up according to the expenditure items of the "Non-operating expenses" account for detailed accounting. .
When carrying forward profits and losses at the end of the period, the balance of the "non-operating expenses" account should be transferred from the credit to the debit of the "profit for the year" account. There should be no balance in the account after the transfer.