197 intangibles:Oa. Include intangible assets created and not purchased by the taxpayerOb. Are amortized based on current fair market value rather than their actual cost.Oc. Must be amortized over a 15 year life, regardless of their actual life.а.Od. Do not include purchased goodwill or going-concern value. Grape Pack Corp bought a $600,000 apartment building in June of 2020. Of the purchase price, $104,950 is allocated to the value of the land. What isthe maximum amount of depreciation that the company can claim in 2021 (Year 2) for the building?Oa. You cannot depreciate property costing over $500,000Оb. $21.816Oc. $25,000 under the election to expense business propertyOd. $9,752Oe. $18,000

Intangible assets are those assets which are not physically existed. In simple, these are those…

197 intangibles: Oa. Include intangible assets created and not purchased by the taxpayer Ob. Are amortized based on current fair market value rather than their actual cost Oc. Must be amortized over a 15 year life, regardless of their actual life. Od. Do not include purchased goodwill or going-concern value.

197 intangibles: Oa. Include intangible assets created and not purchased by the taxpayer Ob. Are amortized based on current fair market value rather than their actual cost Oc. Must be amortized over a 15 year life, regardless of their actual life. Od. Do not include purchased goodwill or going-concern value.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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11 In a taxable asset acquisition, the seller would likely pay ordinary income taxes on the gain resulting from the sale of which of the following assets: a. Inventory b. Accounts Receivable c. Recaptured Depreciation Amounts under IRC 1245 d. All of the above
Under IAS 36, which of the following is a recoverable amount? Historical cost of the asset Carrying amount of the asset Present value of future cash flows generated by the asset O Original purchase price of the asset
12 In a taxable asset acquisition, amounts allocated to Class VI and Class VII assets will likely be amortized by the buyer over how many years: a. 5 years under IRC 167 b. 20 years under IRC 168 c. 15 years under IRC 197 d. 39.5 years under IRC 212
Write CA if the item is normally reported as a current asset, NCA if non- current. If not an asset, write NA. 9. Contingent asset 10. Financial Asset at Fair Value at OCI
What is the treatment of a § 179 expensing carryforward? Any § 179 amount in excess of business income / the asset acquisition cost limitation is carried forward to future taxable years and added to/ deducted from other amounts eligible for expensing. The § 179 amount eligible for expensing in a carryforward year is limited to the greater / lesser of (1) the current statutory dollar amount increased / reduced by the cost of § 179 property placed in service in excess of the appropriate acquisition limit in the carryforward year or (2) the business income / asset acquisition cost limitation in the carryforward year.
Which of the following intangible assets are amortized? (1) Limited-Life (2) Indefinite- Life (1) No (2) Yes (1) Yes (2) Yes (1) No (2) No (1) Yes (2) No
S1: Government grant related to depreciable asset is usually recognized as income over the useful life of the asset and in proportion to the depreciation of the asset. S2: Government grant related to non-depreciable asset that requires fulfillment of certain conditions should be recognized as income immediately.
1. Inventory should be stated at (a) Lower of cost and fair value. (b) Lower of cost and net realizable value. (c) Lower of cost and nominal value. (d) Lower of cost and net selling price. 2. Which of the following costs of conversion cannot be included in cost of inventory? (a) Cost of direct labor. (b) Factory rent and utilities. (c) Salaries of sales staff (sales department shares the building with factory supervisor). (d) Factory overheads based on normal capacity. 3. Inventories are assets (a) Used in the production or supply of goods and services for administrative purposes. (b) Held for sale in the ordinary course of business. (c) Held for long-term capital appreciation. (d) In the process of production for such sale. (e) In the form of materials or supplies to be consumed in the production process or the rendering of services. (f) Choices b and d. (g) Choices b, d, and e. 4. The cost of inventory should not include (a) Purchase price. (b) Import duties and other taxes. (c)…
1. IAS 36 applies to which of the following assets? (a) Inventories. (b) Financial assets. (c) Assets held for sale. (d) Property, plant, and equipment. 2. Value-in-use is (a) The market value. (b) The discounted present value of future cash flows arising from use of the asset and from its disposal. (c) The higher of an asset’s fair value less cost to sell and its market value. (d) The amount at which the asset is recognized in the balance sheet. 3. If the fair value less costs to sell cannot be determined (a) The asset is not impaired. (b) The recoverable amount is the value-in-use. (c) The net realizable value is used. (d) The carrying value of the asset remains the same. 4. If assets are to be disposed of (a) The recoverable amount is the fair value less costs to sell. (b) The recoverable amount is the value-in-use. (c) The asset is not impaired. (d) The recoverable amount is the carrying value. 5. Estimates of future cash flows normally would cover projections over a maximum…
The “excess of the acquirer’s interest in the net fair value of acquiree’sidentifiable assets, liabilities, and contingent liabilities over cost” (formerly knownas negative goodwill) should be A. Reassessed as to the accuracy of its measurement and then recognized immediately in profit or loss.B. Amortized over the life of the assets acquired.C. Carried as a capital reserve indefinitely.D. Reassessed as to the accuracy of its measurement and then recognized in retained earnings.
Any excess of the fair value over book value attributable to land on the date of acquisition is to be: a. allocated to other identifiable assets. b. capitalized and amortized. c. charged to Retained Earnings on the date of acquisition. d. taken into income when the Land is sold.
Under IAS 36 Impairment of Assets, impairment test for an individual asset requires that the carrying amount of the asset be compared to its recoverable amount. According to IAS 36, ‘recoverable amount’ is defined as the higher of two items. Which one of the following correctly describes these two items? a. present value of future cash flows from the asset and fair value of asset less costs of disposal b. future cash flows from the asset and fair value of asset less costs of disposal c. future cash flows from the asset and fair value of asset d. present value of future cash flows from the asset and fair value of the asset