Rosetta Stone 2011 Annual Report Download - page 105

Table of Contents
ROSETTA STONE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
7. INTANGIBLE ASSETS (Continued)
development of new products in the amount of $0.3 million. The estimated lives of the acquired core technology and customer relationships are between 18 to
36 months. The intangible asset associated with the trade name and trademark has an indefinite useful life. The estimated life of the website rights is
60 months, and estimated useful life of the patents are based on the effective date of the purchase agreement through the expiration date of the patents. The
Company computes amortization of intangible assets on a straight-line basis over the estimated useful life. Below are the estimated useful lives of the
intangible assets acquired:
Weighted Average Life
Trade name / trademark Indefinite
Core technology 24 months
Customer relationships 24 months
Website 60 months
Patents 72 - 100 months
In accordance with Accounting Standards Codification topic 360, Property, Plant, and Equipment, the Company reviews its long-lived assets, including
property and equipment and definite-lived intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amounts
of the assets may not be fully recoverable. If the total of the expected undiscounted future net cash flows is less than the carrying amount of the asset, a loss is
recognized for the difference between the fair value and carrying amount of the asset. There were no impairment charges for the year ended December 31,
2011 and 2010.
Amortization expense consisted of the following (in thousands):
Years Ended December 31,
2011 2010 2009
Included in cost of revenue:
Cost of product revenue $ — $ — $ —
Cost of subscription and service revenue — — —
Total included in cost of revenue — — —
Included in operating expenses: $ 85 $ 58 $ 42
Total $ 85 $ 58 $ 42
The following table summarizes the estimated future amortization expense related to intangible assets as of December 31, 2011 (in thousands):
As of
December 31, 2011
2012 $ 40
2013 40
2014 40
2015 40
2016 40
Thereafter 57
Total $ 257
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