Intermediate Accounting - Chapter 10 & 11 Test Review

• -lack physical substance

• -patents, copyrights, trademarks, franchises, goodwill

• natural resources

• initial cost

• intangible assets

What is a natural resource?

• oil, gas, timber tracts, mineral deposits

• initial cost

How can property, plant, and equipment be acquired?

• purchase, donation, lease, exchange, business, self construction

• Inheritance

How to calculate cost of equipment?

• purchase price

• sales tax

• transportation

• legal fees and other costs

• expenditures for installation and testing

-purchase price

-attorney fees

-real estate agent commissions

-costs related to title

-recording fees

-expenditures

-back taxes

How are land improvement costs identified and capitalized?

-purchase price

-realtor commissions and legal fees

-reconditioning costs

-purchase price

-any other costs necessary to bring the asset to the condition and location for use

What does amortized mean?

• infinite useful life

• finite useful life

What is the exclusive right to manufacture a product or to use a process?

• monopoly

• patent

• contract

• treaty