Intangible Assets

Which of the following is NOT a characteristic of an intangible asset?

• Identifiable

• Lack of physical existence

• Monetary asset

• Non-current asset

• Provides future economic benefits

How should a company account for internally generated goodwill?

• Capitalize it as an intangible asset

• Record it as an expense

• Recognize it as equity

• Record it at fair value

• Do not recognize it

What is the appropriate treatment for limited-life intangible assets?

• Amortize over useful life

• Do not amortize

• Expense as incurred

• Test for impairment annually

• Capitalize indefinitely

Which of the following is an example of a marketing-related intangible asset?

• Patent

• Customer list

• Trademark

• Franchise

• Goodwill

What is goodwill often referred to as?

• A tangible asset

• A residual value

• A separable asset

• A monetary asset

• A contractual right

How should research costs be accounted for under IFRS?

• Capitalize as an intangible asset

• Amortize over the useful life

• Expense as incurred

• Record as goodwill

• Defer until project completion

Which of the following is TRUE regarding the impairment of limited-life intangible assets?

• They are not tested for impairment

• Impairment is recognized only if fair value is higher than carrying amount

• Impairment loss is recorded when recoverable amount is less than carrying value

• Impairment losses are always reversible

• Impairment is based solely on market value

Which type of intangible asset is NOT amortized?

• Limited-life intangible

• Patent

• Trademark with indefinite life

• Copyright

• Customer list

What is the primary criterion for capitalizing development costs?

• The project is in the research phase

• The project is economically viable

• The costs are less than $1 million

• The project has been patented

• The project is internally funded

What is the accounting treatment for goodwill acquired in a business combination?

• Amortize over 10 years

• Expense immediately

• Test for impairment annually

• Record as revenue

• Capitalize and depreciate