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WorksheetsAccounting for Intangibles
Total questions: 13
Worksheet time: 8mins
Intangible assets have unlimited life because they have no physical substance.
True
False
The diminishing-balance method of amortization is the most common method of amortization for intangibles.
True
False
A franchise is a contractual arrangement under which the franchisor grants the franchisee the right to sell certain products and/or to provide specific services
True
False
Goodwill CANNOT be sold individually as it is part of the business as a whole.
True
False
Goodwill has an indefinite life
True
False
Intangible assets are the rights and privileges that result from ownership of long-lived assets that:
a. must be generated internally.
b. are depreciable natural resources.
c. have been exchanged at a gain.
d. do not have physical substance.
If a company incurs legal costs in successfully defending its patent, these costs are recorded by debiting:
a. Legal Expense.
b. a Loss on Intangibles account.
c. the Patent account.
d. an operating expenditure account.
An asset that CANNOT be sold individually is:
a. a patent.
b. goodwill.
c. a copyright.
d. a trade name.
Which of the following is an intangible asset that has a finite life?
a. goodwill
b. patent
c. trademark
d. franchise
A patent can be renewed
a. every twenty years.
b. only after its economic life has been exhausted.
c. only if significantly defended in an infringement suit.
d. A patent can never be renewed
Development costs:
a. are always expensed when incurred.
b. cannot be recorded separately from research costs.
c. can be capitalized if it can be shown that the costs will provide future benefits.
d. are intangible assets that are not amortized.
Research costs:
a. are classified as intangible assets.
b. must be expensed when incurred under both IFRS and ASPE.
c. should be included in the cost of the patent they relate to.
d. are capitalized and then depreciated over a period not to exceed 40 years.
Which of the following is NOT an intangible asset that is reported on the balance sheet?
a. goodwill
b. trademarks
c. employees
d. copyrights
