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, 000 Expenditure on promoting the new product 50, 000 Employee benefits relating to the testing of the proper functioning of the new process 200, 000 What is the total cost that should be capitalized as an intangible noncurrent assets in respect of the new process?

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, 000 Expenditure on promoting the new product 50, 000 Employee benefits relating to the testing of the proper functioning of the new process 200, 000 What is the total cost that should be capitalized as an intangible noncurrent assets in respect of the new process?

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter7: Operating Assets

Section: Chapter Questions

Problem 25CE: Cost of Intangible Assets Advanced Technological Devices Inc. acquired a patent for $91,500. It...

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Kim Company, an SME, has acquired a trademark relating to the introduction of a new manufacturing process. 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?
Company B has acquired a trademark relating to the introduction of a new manufacturing process. The costs incurred were as follows: 1. Cost of trademark, 150,000 2. Expenditure on promoting the new product, 5,000 3. Employee benefits relating to the testing of the proper functioning of the new process, 25,000 According to IAS 38 - 'Intangible assets', what is the total cost that can be capitalised as an intangible fixed asset in respect of the new process? A. 150,000 B . 155,000 C. 175,000 D. 180,000
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?
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. 1,585,000
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
Case 5. The assets of a CGU at year-end are as follows: Property, Plant and Equipment Patent Goodwill Carrying amount 2,500,000 3,500,000 1,000,000 Fair value 2,000,000 3,000,000 1,000,000 The most recent review assesses the value in use of the CGU to be 4,500,000. 24. What total amount should be reported as impairment loss on goodwill? 25. What is the impairment loss to be allocated to the PPE?
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 trademark
The components of the cost of a major item of equipment are given below. GHS Purchaseprice 780,000 Import duties 117,000VAT (refundable) 78,000 Site preparation 30,000 Installation costs 28,000 Pre-production 18,000 Initial operating losses before the asset reaches planned performance…
Which 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
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:
Sandhill 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.
Write CAPITALIZED if the subsequent cost incurred SHALL FORM PART of the carrying amount of the PPE or EXPENSED OUTRIGHT if the subsequent cost incurred SHALL NOT FORM PART of the carrying amount of the PPE. Acquired safety equipment to be attached for one of the production equipment for P 150,000 as required by new law. Acquired five new machineries for new P 800,000 each. Rearranged the production PPEs in Factory A for P 500,000 to make it more presentable before the management team visits the factory. Rearranged the production PPEs in Factory B for P 400,000 to accommodate a newly purchased equipment that will make the production process faster and more efficient. Repaired one of the machineries for P 350,000 as part of factory’s annual examination. Repaired another machinery for P 275,000 to prolong its remaining useful life from five years to seven years. Replaced a significant part of a production equipment for P 900,000. The equipment has an original cost of P 4,000,000 and…