. The cost incurred were as follows: Cost of trademark, P5,000,000 Expenditure on promoting the new product, P200,000 Employee benefits relating to the testing of the proper functioning of the new process, P800,000 What is the total cost that should be capitalized as intangible assets?
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- During the current accounting period, Jack Ltd considered the recognition of the following costs as intangible assets. GHS 40,000 spent on evaluating research findings GHS 60,000 spent on acquiring a brand name from a competitor GHS 50,000 spent on acquiring the legal rights to a production process, without which Jack Ltd’s business cannot function In accordance with IAS 38 Intangible Assets, what is the maximum amount that Jack Ltd could recognize as intangible assets?3. ABC Company has acquired a trademark relating to the introduction of a new manufacturing process. The costs incurred were as follows:Cost of trademark 3, 500, 000Expenditure on promoting the new product 50, 000Employee benefits relating to the testing of the proper functioning of the new process 200, 000What is the total cost that should be capitalized as an intangible noncurrent assets in respect of the new process?A company had the following expenditures related to developing its trademark. General advertising costs Advertising specifically focused on trademark development Legal fees to register trademark Registration fees for the trademark Legal fees for successful defense of the new trademark Total $ 300,000 120,000 52,000 38,000 33,000 $ 543,000 During your year-end review of the accounts related to intangibles, you discover that the company has capitalized all the above as costs of the trademark. Management contends that all of the costs increase the value of the trademark; therefore, all the costs should be capitalized. Required: 1. Which of the above costs should the company capitalize to the Trademark account in the balance sheet? 2. Which of the above costs should the company report as expense in the income statement? Total costs capitalized Total costs expensed
- II. Broncos Corporation acquired the following assets associated with a manufacturing facility for a lump-sum price of $9,000,000. According to independent appraisals, the fair values were $4,000,000, $2,000,000, $3,000,000, and $1,000,000 for the building, patent, land, and equipment, respectively. What should be the initial value of the patent? Show your computation. III. Shown below is activity for one of the products of Denver Office Equipment: January 1 balance, 500 units @ $55 Purchases: January 10: 500 units @ $60 January 20: 800 units @ $63 Sales: January 12: 750 units January 28: 650 units 1) Compute the cost of goods sold for January, assuming Denver uses FIFO and periodic inventory system. Cost of goods sold: $ Your computations: 2) Compute the January 31 cost of ending inventory, assuming Denver uses LIFO and periodic inventory system. Cost of ending inventory: $ Your computations:Royal Com nany purchased a new trademark and incurred the following costs: Purchase price Nonrefundable value added tax Training of personnel on the use of new trademark Research expenditures associated with the purchase of the new trademark Legal cost incurred to register the new trademark 1,000,000 50,000 70,000 240,000 105,000 120,000 Administrative salaries What amouont should be reported as initial cost of the trademark? a. 1,000,000 b. 1,155,000 c. 1,465,000 d. 1,585,000A company acquired the following assets associated with a manufacturing facility for a lump-sum price of $10,700,000. According to independent appraisals, the fair values were $4,275,000, $4,275,000, $4,275,000, and $1,425,000 for the building, patent, land, and equipment, respectively. The initial value of the patent would be:
- Broncos Corporation acquired the following assets associated with a manufacturing facility for a lump-sum price of $9,000,000. According to independent appraisals, the fair values were $4,000,000, $2,000,000, $3,000,000, and $1,000,000 for the building, patent, land, and equipment, respectively. What should be the initial value of the patent? Show your computation.According to IAS 38 Intangible Assets, which of the following types of research and development expenditure must be written off in the year it is incurred? A Costs of designing a pre-production prototype B Legal costs in connection with registration of a patent C Costs of searching for possible alternative products D Costs of research work which are to be reimbursed by a customerWhich of the following statements concerning intangibles is true? a. a copyright should be considered an intangible with an indefinite lifeb. organization costs must be expensed as incurredc. a patent should be amortized over the shorter of the inventor’s life or its economic lifed. the registration of a trademark or tradename lasts for 20 years and is nonrenewable
- On January 1, 2023. RDG Company acquired trademark from DTR Company for a total cost of P 150,000, Other related costs incurred include the following: Cost of employee benefits arising directly from bringing the asset to its intended condition P 15,000 Professional fees arising directly from bringing the asset to its intended condition 10,000 Cost od introducing the new product including advertisement costs 5,000 The initial cost of the trademarkABC Corporation is a company that specializes in (1) research and development of new medications and (2) acquisition of patents for new medications. ABC follows IFRS accounting standards. In ABC's situation, which of the following statements about the treatment of intangible assets is correct? Intangible assets with indefinite lives must be amortized annually. Intangible assets must be measured using the cost model Research and development costs are expensed as incurred, except for software development. O Intangible assets may be revalued to fair value if there is an active market for the assetSandhill Co. incurred research and development costs in 2021 as follows: Materials used in research and development projects $ 930000 Equipment acquired that will have alternate future uses in future research and development projects 2800000 Depreciation for 2021 on above equipment 466666 Personnel costs of persons involved in research and development 730000 projects Consulting fees paid to outsiders for research and development projects 280000 Indirect costs reasonably allocable to research and development projects 205000 $5411666 The amount of research and development costs charged to Sandhill's 2021 income statement should be O $2126666. O $1940000. O $4740000. O $2611666.