13.3KB/s O ll4G+12:43 PM6100:17:07 RemainingMultiple ChoiceWhich of the following statementsis false regarding PATENT[technology-based intangible asset]?The cost of a patent includes purchase priceand any directly attributable expenditureincurred in acquiring the patent and putting itinto use.O All related research & developmentexpenditures for an internally developedpatent are generally expensed as incurred.Legal fees and litigation costs of successfullydefending a patent are capitalized as part ofthe cost of patent.Patents should be amortized over the legallife or useful life, whichever is shorter.9 of 25レ

The assets that are held by the organization that does not have a physical substance are described…

Multiple Choice Which of the following statements is false regarding PATENT [technology-based intangible asset]? The cost of a patent includes purchase price and any directly attributable expenditure incurred in acquiring the patent and putting it into use. All related research & development expenditures for an internally developed patent are generally expensed as incurred. Legal fees and litigation costs of successfully defending a patent are capitalized as part of the cost of patent. Patents should be amortized over the legal life or useful life, whichever is shorter.

Multiple Choice Which of the following statements is false regarding PATENT [technology-based intangible asset]? The cost of a patent includes purchase price and any directly attributable expenditure incurred in acquiring the patent and putting it into use. All related research & development expenditures for an internally developed patent are generally expensed as incurred. Legal fees and litigation costs of successfully defending a patent are capitalized as part of the cost of patent. Patents should be amortized over the legal life or useful life, whichever is shorter.

Accounting

27th Edition

ISBN:9781337272094

Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Chapter26: Capital Investment Analysis

Section: Chapter Questions

Problem 7DQ: A net present value analysis used to evaluate a proposed equipment acquisition indicated a 7,900 net...

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E12.1B (L0 1,2) (Classification Issues—Intangibles) Presented below is a list of items that could be included in the intan- gibleassets section of the balance sheet. 1. Cost of purchasing a patent from an inventor. 2. Unrecovered costs of a successful legal suit to protect the patent. 3. Cost of purchasing a copyright. 4. Long-term receivables. 5. Cost of purchasing a trademark. 6. Cost of developing a trademark. 7. Research and development costs. 8. Cost of conceptual formulation of possible product alternatives. 9. Legal costs incurred in securing a patent. 10. Cost of developing a patent. 11. Timberland. 12. Lease prepayment (6 months’ rent paid in advance). 13. Cost of searching for applications of new research findings. 14. Operating losses incurred in the start-up of a business. 15. Purchase cost of a franchise. 16. Goodwill generated internally. 17. Goodwill acquired in the purchase of a business. 18. Cost of testing in search for product alternatives. 19. Training costs…
10. Which of the following statement is false? The cost of an internally generated patent is confined to legal and registration fees only An intangible asset with definite life is amortized Goodwill is an intangible asset but not under PAS 38 The cost of modification of a product to conform with customer's demand is an R&D expense
Q21 Which of the following is NOT a step in impairment testing? Select one: a. Sell the asset after if the fair value is greater than the recoverable amount b. Calculate the asset’s carrying amount in the books of the entity c. Calculate the recoverable amount of the asset d. Assess whether there are circumstances that may indicate that the asset should be impaired.
q19 Which statement is INCORRECT regarding recognition of intangible assets? Select one: a. An intangible asset should be initially recorded at cost. b. An intangible asset acquired in exchange of another asset can be recognized at the fair value of the asset given up in exchange. c. An intangible asset can only be recognized if its cost can be measured reliably. d. An intangible asset can be recorded at its fair value if its cost cannot be ascertained.
Q10 Which of the following statement is NOT correct? Select one: a. When the carrying amount of an asset is less than the recoverable amount, then an asset should have its previous impairments reversed to the value of the recoverable amount provided there is accumulated amortization to cover the difference. b. The difference between the carrying amount of an asset and the recoverable is the impairment loss if the carrying amount is greater. c. When the carrying amount of an asset is greater than the recoverable amount, then an asset should be impaired to the value of the recoverable amount d. The difference between the carrying amount of an asset and the recoverable is the impairment loss if the carrying amount is less.
EXERCISE 11–1 Indicate whether the items below are to be capitalized as an intangible asset or expensed. Which account(s) would each item be recorded to? Salaries of research staff Costs to test prototypes Borrowing costs for development of a qualifying intangible asset Executive salaries for time spent on development of an intangible asset Costs to launch a new product Purchase cost of a patent from a third party Product research costs Costs internally incurred to create goodwill Legal costs to successfully defend a patent Purchase price of new software Training costs for new software Direct costs of special programming needed when purchasing new software Costs incurred in forming a corporation for purposes of commercializing a new product Operating losses incurred in the start-up of a business to manufacture a patented produce The purchase cost of a franchise The cost of developing a patent The cost of purchasing a patent from an inventor Legal costs incurred in securing a patent…
Q12 Which of the following is correct about the initial measurement of intangible asset? Select one: a. The physical or tangible assets that were used as part of the development of the intangible asset should also be included in the cost. b. Research expenditure should also be included in the cost of the intangible asset if it was developed internally. c. An intangible asset should be recorded at cost which is the sum of expenditure incurred until the date that the asset first met the recognition criteria of an intangible asset. d. When an intangible asset is acquired in exchange of another asset, it should be recorded at its fair value at the date of acquisition.
4. Which of the following costs would not be capitalized? a. Acquisition cost of equipment to be used on current and future research projects. b. Engineering costs incurred to advance the project to the full production stage. c. Cost incurred to file for patent. d. Cost of testing prototype before economic feasibility has been demonstration.
Question # 10 a. Over what period of time should the cost of a patent acquired by purchased be amortized? b. In general, what is the required accounting treatment for research and development costs? c. How should goodwill be amortized? they all come together is for question #10
Compute for the gain on sale of patent under the following problem A) P2,620,000 B) P925,000 C) P1,078,125 D) P995,000
18 Fair value less cost to sell: P650,000 Value in use:P750,000 Carrying amount:P1,010,000 Compute the impairment loss Group of answer choices P160,000 P100,000 P260,000 P360,000
Q1 Which of the following statement (s) is (are) true? (i) When no future economic benefits are no longer expected to flow from an intangible asset, such asset should be derecognized the financial statements of an organization. (ii) When an intangible asset is derecognized, the carrying amount should be written off as a loss in the profit or loss statement at the date of retirement of the asset. (iii) When an intangible asset is sold, the difference between the carrying amount and consideration received is recognized in the profit or loss statement at the date of the sale. (iv) Consideration to be received in the event of sale of an intangible asset should only be cash Select one: a. (ii) and (iv) only b. (i) and (ii) only c. (i) and (iv) only d. (i), (ii) and (iii) only