The
Definition Of

Trademark /Trade names

A trademark or trade name is a word, phrase, jingle, or symbol that identifies a particular enterprise or product. Trade names like Wheaties, Game Boy, Frappuccino, Kleenex, Windows, Coca-cola, and Jeep create immediate product identification. They also generally enhance the sale of the product. The creator or original user may obtain exclusive legal right to the trademark or trade name by registering it with the U.S. Patent Office. Such registration provides 20 years of protection. The registration may be renewed indefinitely as long as the trademark or trade name is in use.

If a company purchases the trademark or trade name, its cost is the purchase price. If a company develops and maintains the trademark or trade name, any costs related to these activities are expensed as incurred. Because trademarks and trade names have indefinite lives, they are not amortized.

Share it:

More from this Section

  • Price-earnings (P-E) ratio
    The price-earnings (P-E) ratio is an oft-quoted measure of the ratio of the market price of each share of common stock to the earnings per share; computed...
  • Total overhead variance
    Total overhead variance refers to the difference between actual overhead costs and overhead costs applied to work done.
  • Current liability
    A current liability is a debt that a company can reasonably expect to pay (1) from existing current assets or through the creation of other current liabilities...
  • Total labor variance
    Total labor variance is the difference between actual hors times the actual rate and standard hours times the standard rate for labor.
  • Direct materials price standard
    The direct materials price standard is the cost per unit of direct materials that should be incurred. This standard should be based on the purchasing department’s best...
  • Contractual interest rate
    The contractual interest rate, often referred to as the stated rate, is the rate used to determine the amount of cash interest the borrower pays and the investor receives.
  • Debt to total assets ratio
    Debt to total assets ratio is a solvency measure that indicates the percentage of total assets provided by creditors: computed as total debt divided by total assets.