Indicate whether each of the following statements is true or false.If a new patent is acquired through modification of an existing patent, theremaining book value of the original patent may be amortized over the life of thenew patent.If the recoverable amount of an indefinite-life intangible other than goodwill is lessthan its carrying value, an impairment loss must be recognized.Research and development costs are recorded as an intangible asset if it is felt theywill provide economic benefits in future years.

Goodwill represents the amount that is the difference between the compensation paid and difference…

Answered: Indicate whether each of the following…

Financial Reporting, Financial Statement Analysis and Valuation

8th Edition

ISBN:9781285190907

Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Chapter8: Investing Activities

Section: Chapter Questions

Problem 6QE

See similar textbooks

Similar questions

Indicate whether each of the following statements is true or false. If an intangible asset has its fair value determined in an active market, IFRS permits the use of the revaluation model. Answer If an intangible asset has an indefinite life, no amortization is recorded and no test for impairment is required. Answer When dealing with internally developed intangibles, once the asset is ready for its intended use, any subsequent costs are capitalized.
Under IFRS, a company that acquires an intangible asset may use the revaluation model for subsequent measurement only if a. The useful life of the intangible asset can be readily determined. b. An active market exists for the intangible asset. c. The cost of the intangible asset can be measured reliably. d. The intangible asset is a monetary asset.
All of the following are true regarding the revaluation model allowed under GAAP except; Select one: a. Once selected, the revaluation policy applies to an entire class of property, plant and equipment. b. When an asset is revalued, any increase in carrying amount is reported as miscellaneous revenue. c. After initial recognition, the revalued amount is fair value less subsequent depreciation and impairment losses. d. Revaluations must be made regularly to ensure that the carrying value is not materially different from fair value.
Which of the following is/are not capitalized as an intangible asset? Select one: a. Legal costs to defend a patent successfully and goodwill acquired when a company purchases another company. b. Costs of an internally developed patent and goodwill acquired when a company purchases another company. c. Costs of an internally developed patent and legal costs to defend a patent successfully. d. Goodwill acquired when a company purchases another company and costs to purchase a patent. e. Costs to purchase a patent and legal costs to defend a patent successfully.
An entity that acquires an intangible asset may use the revaluation modelfor subsequent measurement only if A. The useful life of the intangible asset can be reliably determined.B. An active market exists for the intangible asset.C. The cost of the intangible asset can be measured reliably.D. The intangible asset is a monetary asset.
Under IFRS, an entity that acquires an intangible asset may use the revaluation model for subsequent measurement only if The intangible asset is a monetary asset The cost of the intangible asset can be measured reliably The useful life of the intangible asset can be reliably determined An active market exists for the intangible asset
IFRS allows a corporation to utilize the revaluation model for future assessment only if the useful life of the intangible asset can easily be established. As a result, there is a healthy intangible asset market. c. The intangible asset's cost can be accurately calculated. It is a financial asset when an intangible asset is a monetary one.
When an intangible asset has a finite life, amortization should be taken over what period of time? The shorter of the asset’s useful life or its legal life. The longer of the asset’s useful life or its legal life. According to U.S. GAAP, all costs should be expensed. No amortization should be taken on intangible assets.
If fair value of an impaired intangible asset recovers after an impairment has been recognized, a restoration gain may be recorded in a subsequent period. O a. True O b. False
IFRS: permits reversal of impairment losses when there has been a change in economic conditions. O requires expensing of all R&D costs. O permits revaluation for goodwill. O permits capitalization of all internally generated intangible assets.
Under U.S. GAAP, litigation costs to successfully defend an intangible right are capitalized and amortized over the remaining useful life of the related intangible. How are these costs typically accounted for under IFRS?
Which of the following statements is true? Question 2 options: a The capitalizable costs of patents are legal fees and other registration costs. b An identifiable tangible asset developed internally is never recognized in the accounts as an asset. c Intangible assets usually have a residual value that must be considered in the amortization of cost. d An intangible asset is usually amortized by a credit to an income account.

SEE MORE QUESTIONS

Recommended textbooks for you

Financial Reporting, Financial Statement Analysis…

Finance

ISBN:

9781285190907

Author:

James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:

Cengage Learning