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1. Question : Which of the following accounting principles or conventions is contradictory to the GAAP requirement to expense R&D costs immediately? Student Answer: historical cost principle comparability conservatism matching principle Points Received: 2 of 2 Comments: 2. Question : Which of the following characteristics is not common to both tangible and intangible assets? Student Answer: held for use and not for investment expected life of more than one year derive value from the ability to generate revenue may have value only to a particular company Points Received: 2 of 2 Comments: 3. Question : Costs for which of the following activities should not be included in research and development (R&D)? Student Answer: modification of the formulation or design of a product or process design of tools, jigs, molds, and dies involving new technology design, construction, and testing of preproduction prototypes and models trouble-shooting in connection with breakdowns during commercial production Points Received: 2 of 2 Comments: 4. Question : Which of the following statements regarding intangible assets is true? Student Answer: The expected useful life of an intangible asset is generally easier to estimate than the expected useful life of a tangible noncurrent asset. The cost of an intangible asset is not permitted to be amortized for income tax purposes. Intangible assets have a lower degree of uncertainty with regard to their expected future benefits than tangible noncurrent assets. The accumulated amortization for intangible assets that are amortized must be disclosed. Points Received: 0 of 2 Comments: 5. Question : Which of the following is an intangible asset that is not typically amortized? Student Answer: patent copyright franchise trademark Points Received: 0 of 2 Comments: 6. Question : The Walters Company made the following expenditures for research and development early in 2010 - Essay Writing Service: Write My Essay by Top-Notch Writer: $40,000 for materials, $50,000 for contract services, $40,000 for employee salaries, and $400,000 for a building with an expected life of 20 years to be used for current and future research projects. Walters uses straight-line depreciation. The company allocated $10,000 in overhead to research and development. What is Walters' research and development expense for 2010 - Essay Writing Service: Write My Essay by Top-Notch Writer? Student Answer: $100,000 $110,000 $160,000 $350,000 Points Received: 2 of 2 Comments: 7. Question : The cost of an internally developed unidentifiable intangible is expensed as incurred. Accordingly, which one of the following costs would be expensed in the year it was incurred? Student Answer: legal cost of obtaining a patent cost of improvements with a three-year life made to an asset that is being leased by the company for a five-year period deferred charges cost incurred to train management-level employees Points Received: 2 of 2 Comments: 8. Question : Which of the following research and development costs should always be capitalized? Student Answer: costs of intangibles purchased from others costs of materials, equipment, and intangibles with alternative future uses purchased from others costs of equipment with an expected life greater than three years costs of contract services purchased from others Points Received: 2 of 2 Comments: 9. Question : In January 2010 - Essay Writing Service: Write My Essay by Top-Notch Writer, the Remy Corporation purchased a patent for $231,000 from Nel Company that had a remaining legal life of 14 years. Remy estimated that the remaining economic life would be seven years. In January 2014: 2024 - Essay Writing Service | Write My Essay For Me Without Delay, the company incurred $30,000 in legal costs to defend the patent from an infringement. Remyâs lawyers were successful, and the remaining years of benefit from the patent were estimated to be six years. The patent amortization expense for 2014: 2024 - Essay Writing Service | Write My Essay For Me Without Delay is Student Answer: $7,615 $9,923 $16,500 $21,500 Points Received: 2 of 2 Comments: 10. Question : The Fallen Company began business early in 2010 - Essay Writing Service: Write My Essay by Top-Notch Writer, when Fallen paid an initial fee of $100,000 to purchase a franchise. In forming the company, Fallen also spent $11,000 on legal fees and $4,500 on accounting fees. During the year, Fallen spent $7,500 on product development and paid $10,000 in continuing franchise fees. What amount should Fallen capitalize for intangible assets in 2010 - Essay Writing Service: Write My Essay by Top-Notch Writer? Student Answer: $100,000 $115,500 $123,000 $133,000
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