Definition

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:  Cite

More from this Section

  • Percentage-of-sales
    In the percentage-of-sales basis, management estimates what percentage of credit sales ...
  • Posting
    Posting is the procedure of transferring journal entries to the ledger accounts. This ...
  • State unemployment taxes
    State unemployment taxes refer to taxes that are imposed on the employer by states that ...
  • Audit
    Audit is the examination of the books and accounts of a company to examine the books and ...
  • Voucher register & Check register
    An employee in accounts payable records the voucher which in a journal called a voucher ...