Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN: 9781337788281

Author: James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher: Cengage Learning

Not helpful? See similar books

Intermediate Accounting: Reporting And Analysis

Intangibles. 1MC

Question

Chapter 12, Problem 1MC

To determine

Identify the correct option for the given statement.

Expert Solution & Answer

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN: 9781337788281

Author: James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher: Cengage Learning

Not helpful? See similar books

Intermediate Accounting: Reporting And Analysis

Intangibles. 1MC

Similar questions

To this solution

Intermediate Accounting: Reporting And Analysis

Ch. 12 - Prob. 1GICh. 12 - Prob. 2GICh. 12 - Prob. 3GICh. 12 - Prob. 4GICh. 12 - Prob. 5GICh. 12 - Prob. 6GICh. 12 - Prob. 7GICh. 12 - Prob. 8GICh. 12 - Prob. 9GICh. 12 - Prob. 10GI

Ch. 12 - Prob. 11GICh. 12 - Prob. 12GICh. 12 - Prob. 13GICh. 12 - Prob. 14GICh. 12 - Prob. 15GICh. 12 - Prob. 16GICh. 12 - Prob. 17GICh. 12 - Prob. 18GICh. 12 - Prob. 19GICh. 12 - Prob. 20GICh. 12 - Prob. 1MCCh. 12 - Prob. 2MCCh. 12 - Prob. 3MCCh. 12 - Prob. 4MCCh. 12 - Prob. 5MCCh. 12 - Prob. 6MCCh. 12 - Prob. 7MCCh. 12 - Prob. 8MCCh. 12 - Prob. 9MCCh. 12 - Prob. 10MCCh. 12 - Prob. 1RECh. 12 - Prob. 2RECh. 12 - Prob. 3RECh. 12 - Prob. 4RECh. 12 - Prob. 5RECh. 12 - Prob. 6RECh. 12 - Prob. 7RECh. 12 - Prob. 8RECh. 12 - Prob. 9RECh. 12 - Prob. 10RECh. 12 - Prob. 1ECh. 12 - Prob. 2ECh. 12 - Prob. 3ECh. 12 - Prob. 4ECh. 12 - Prob. 5ECh. 12 - Prob. 6ECh. 12 - Prob. 7ECh. 12 - Prob. 8ECh. 12 - Prob. 9ECh. 12 - Prob. 10ECh. 12 - Prob. 11ECh. 12 - Prob. 12ECh. 12 - Prob. 13ECh. 12 - Prob. 14ECh. 12 - Prob. 15ECh. 12 - Prob. 16ECh. 12 - Prob. 17ECh. 12 - Prob. 18ECh. 12 - Prob. 19ECh. 12 - Prob. 20ECh. 12 - Prob. 1PCh. 12 - Prob. 2PCh. 12 - Prob. 3PCh. 12 - Prob. 4PCh. 12 - Prob. 5PCh. 12 - Prob. 6PCh. 12 - Prob. 7PCh. 12 - Prob. 8PCh. 12 - Prob. 9PCh. 12 - Prob. 10PCh. 12 - Prob. 11PCh. 12 - Prob. 1CCh. 12 - Prob. 2CCh. 12 - Prob. 3CCh. 12 - Prob. 4CCh. 12 - Prob. 5CCh. 12 - Prob. 6CCh. 12 - Prob. 7CCh. 12 - Prob. 8C

Knowledge Booster

Similar questions

How are intangible assets with an indefinite life treated? A. They are depreciated. B. They are amortized. C. They are depleted. D. They are tested yearly for impairment.

The following intangible assets were purchased by Goldstein Corporation: A. A patent with a remaining legal life of twelve years is bought, and Goldstein expects to be able to use it for seven years. B. A copyright with a remaining life of thirty years is purchased, and Goldstein expects to be able to use it for ten years. For each of these situations, determine the useful life over which Goldstein will amortize the intangible assets.

The following intangible assets were purchased by Hanna Unlimited: A. A patent with a remaining legal life of twelve years is bought, and Hanna expects to be able to use it for six years. It is purchased at a cost of $48,000. B. A copyright with a remaining life of thirty years is purchased, and Hanna expects to be able to use it for ten years. It is purchased for $70,000. Determine the annual amortization amount for each intangible asset.

Choose the correct. If no legal, regulatory, contractual, competitive, economic, or other factors limit the life of an intangible asset, the asset’s assigned value is allocated to expense over which of the following?a. 20 years.b. 20 years with an annual impairment review.c. Infinitely.d. Indefinitely (no amortization) with an annual impairment review until its life becomes finite.

If no legal, regulatory, contractual, competitive, economic, or other factors limit the life of an intangible asset, the asset’s assigned value is allocated to expense over which of the following?a. 20 years.b. 20 years with an annual impairment review.c. Infinitely.d. Indefinitely (no amortization) with an annual impairment review until its life becomes finite.

Which of the following methods is used to amortize intangible assets over their useful lives?
a. a declining balance methodb. straight linec. annual review for impairmentd. intangible assets are not amortized

What is proper time or time period over which to match the cost of an intangible asset with revenues if it is likely that the benfit of the asset will last fro an indefinite period?
a. 40 yrs
b. 50 yrs
c. immediately
d. at such time as reduction in value can be quantitatively determined
e. either a or b
f. none from the choices given

Which amortization method should be used for intangibles that are amortized?
the straight-line method; all others are inappropriate
a method based on an annual review for impairment
any method is appropriate
a method based on the expected pattern of benefits to be produced by the asset

A certain company makes it the policy that for any new piece of equipment the annual depreciation cost should not exceed 10% of the original cost at any time with no salvage value. Determine the length of service life necessary if the depreciation method used is:
(a) Straight Line Method
(b) Sinking Fund Method
(c) Sum of the Years Digit Method.

Which of the following is not a requirement for an asset to be depreciable?a. It must have a life longer than 1 year b. It must have a basis(initial purchase plus installation cost) greater than $1,000 c. It must be held with the intent to produce income d. It must wear out or get used up.

Determine whether the following intangible assets should be amortized, and determine the length of each asset’s useful life.
If the asset should not be amortized, please provide an explanation clarifying this.
Asset
Should it be amortized?
If yes, what is its useful life?
If no, please explain why
1) A patent on a new medication with a legal life of 20 years.
A patent on a type of manufacturing equipment with a legal life of 20 years. The equipment is expected to be obsolete within 5 years.
3) We purchased the trademarks for Supreme Coffee.
4) We purchased a 15 year Tasty Treats Franchise for the Vaughan territory.
5) We purchased another company for the value of its Owner’s Equity plus Goodwill of $200,000.

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

- SEE MORE QUESTIONS

Recommended textbooks for you

Intermediate Accounting: Reporting And Analysis

Accounting

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:Cengage Learning

Principles of Accounting Volume 1

Accounting

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax College

Survey of Accounting (Accounting I)

Accounting

ISBN:9781305961883

Author:Carl Warren

Publisher:Cengage Learning

Intermediate Accounting: Reporting And Analysis

Accounting

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:Cengage Learning

Principles of Accounting Volume 1

Accounting

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax College

Survey of Accounting (Accounting I)

Accounting

ISBN:9781305961883

Author:Carl Warren

Publisher:Cengage Learning