Understanding Intangible Assets Quiz

What is the definition of intangible assets?

• Physical assets that can be touched and seen.

• Non-physical assets that cannot be touched or seen but have value.

• Assets that are only used for a short period.

• Assets that depreciate over time.

Which of the following is a type of intangible asset?

• Machinery

• Inventory

• Trademark

• Land

What is one of the recognition criteria for intangible assets according to accounting standards?

• The asset must be visible.

• The asset must be separable or arise from contractual or other legal rights.

• The asset must be tangible.

• The asset must be used within one year.

How is the valuation of intangible assets typically determined?

• By their physical weight.

• By their historical cost or fair value.

• By their colour.

• By their size.

What is amortisation in the context of intangible assets?

• The process of increasing the value of an asset over time.

• The process of allocating the cost of an intangible asset over its useful life.

• The process of selling an intangible asset.

• The process of creating a new intangible asset.

Which of the following intangible assets is typically not amortised?

• Patent

• Goodwill

• Copyright

• Franchise

What is required in the disclosure of intangible assets in financial statements?

• Only the name of the intangible asset.

• The cost, amortisation method, and useful life of the intangible asset.

• The physical description of the intangible asset.

• The location of the intangible asset.

Which of the following is an example of an internally generated intangible asset?

• Purchased patent

• Developed software

• Acquired trademark

• Bought franchise

What is the primary difference between tangible and intangible assets?

• Tangible assets are more valuable than intangible assets.

• Tangible assets have a physical form, while intangible assets do not.

• Intangible assets are always more expensive than tangible assets.

• Tangible assets are not recorded in financial statements.

Which of the following is a common method used to estimate the fair value of an intangible asset?

• Cost method

• Market approach

• Physical inspection

• Weight measurement