This year, Level Ground Ltd. went to court and successfully defended its trademarked product, "Hot Gum," from infringement by a competitor. Legal costs of this defence should be charged to
A) Trademarks and amortized over the legal life of the trademark.
B) Trademarks and amortized over the same period of time as the "Hot Gum" trademark.
C) Legal Expense and amortized over five years or less.
D) Legal Expense of the period.

Question

Quizplus · Accepted Answer

The legal costs of defending a trademark should be capitalized and amortized over the remaining useful life of the trademark, as they enhance the value of the trademark.

This Year, Level Ground Ltd