Allscripts LD

Which of the following research and development and software development costs should be expensed? A) Costs incurred to modify or improve an existing profitable product. B) Software costs before technological feasibility C) Research and development purchased as part of an acquisition. D) Salary costs related to discovering a new product. E) Software development costs incurred after the software works and there is a viable market Which of the following may indicate impairment may have occurred? A) Cash discounts are offered on the products the company sells. B) The business environment is stable. C) A high gross profit percentage on products sold. D) A significant decrease in the useful life of the asset.

As computer software is developed that is to be sold, leased, or otherwise marketed, software production costs should be accounted for as follows:                                  Expense up to                                   technological                                   feasibility                              Capitalize after general                                                                                          releasea.                                     Yes                                                Yesb.                                     Yes                                                Noc.                                      No                                                Yesd.                                      No                                                No

Which of the following is NOT part of a firm’s Total Cost of Ownership for an information system?     A.    IT personnel costs     B.    Installation costs for hardware and software     C.    Real Estate (floor space), heating, and cooling costs of data centers, computer centers, and server farms     D.    System downtime costs     E.    Cost of (the firm’s) goods sold (CGS)

Concerning computer software to be sold, leased, or otherwise marketed, which of the following costs are inventoriable and thus included in cost of goods sold? a. maintenance and customer support costsb. design, coding, and testing costs incurred before technological feasibility is establishedc. costs of software developed for internal used. costs of disks, software duplication, and training materials

Which of the following costs would be capitalized? a. Cost of research to determine whether a market for the product exists. b. Salaries of research staff. c. Engineering costs incurred to advance the product to the full production stage. d. Acquisition cost of equipment to be used on current research project only.

Which of the following activities should be expensedcurrently as R&D costs?(a) Testing in search for or evaluation of product orprocess alternatives.(b) Engineering follow-through in an early phase ofcommercial production.(c) Legal work in connection with patent applications orlitigation, and the sale or licensing of patents.

Which of the following groups would be classified as intangible assets for financial accounting and reporting purposes?   Computer software costs, development costs for internally developed patents, research, and goodwill   Long-term notes receivable, copyrights, goodwill, and trademarks   Start-up costs, goodwill, costs of employee training programs, and trademarks   Patents, software development costs, franchises, copyrights, and trademarks

Which of the following groups would be classified as intangible assets for financial accounting andreporting purposes? a. long-term notes receivable, copyrights, goodwill, and trademarksb. patents, computer software costs, franchises, and trademarksc. computer software costs, research and development costs for internally developed patents,patents, and goodwilld. organization costs, goodwill, costs of employee training programs, and trademarks

Which is the best definition of start-up costs? a. All activities associated with organizing a new entity. b. Organization costs. c. One-time activities for opening a new facility, introducing a new product or service, conducting business in a new territory, conducting business with a new class of customer, initiating a new process in an existing facility, or some new operation. d. Activities related to routine ongoing efforts to refine or otherwise improve the qualities of an existing product, service, process or facility.

Solve

If a company constructs a laboratory building to be used as a research and development facility, the cost of the laboratory building is matched against earnings as O depreciation expensed as part of research and development costs. O depreciation or immediate write-off depending on company policy. O research and development expense in the period(s) of construction. O an expense at such time as productive research and development has been obtained from the facility.

Why do we include all the incidental charges relating to the acquisition of a machine in its cost?

Knowledge Check 01 Which of the following factors should be considered when deciding whether to keep a product line or drop it? (Select all that apply) Check All That Apply Opportunity costs of using the production facility currently being used for the product line Revenues generated by the product line Variable costs incurred in manufacturing the product Direct fixed costs associated with the product line Common fixed costs allocated to the product line Research and development costs spent on designing the product line

Why should the total costs of the machine be viewed as an asset and allocated against the future revenue that the machine will generate?