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QUIZ Week 1

1. The document contains 5 multiple choice questions about accounting for intangible assets such as patents and trademarks. 2. For each question, the student's answer is shown along with whether it was correct or not and a brief explanation from the instructor. 3. The questions cover topics like how to record patent amortization, what costs can be capitalized for developed software, calculating amortization expense over time, and recognizing impairment losses on intangible assets.

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3K views2 pages

QUIZ Week 1

1. The document contains 5 multiple choice questions about accounting for intangible assets such as patents and trademarks. 2. For each question, the student's answer is shown along with whether it was correct or not and a brief explanation from the instructor. 3. The questions cover topics like how to record patent amortization, what costs can be capitalized for developed software, calculating amortization expense over time, and recognizing impairment losses on intangible assets.

Uploaded by

hopefuldonor
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Grade Details

1 Question: (TCO C) The total amount of patent cost amortized to date is usually
.
Your Answer: shown in a separate Accumulated Patent Amortization
account which is shown contra to the Patent account.

shown in the current income statement.

reflected as credits in the Patent account. CORRECT

reflected as a contra property, plant, and equipment item.

Instructor Usually shown as credits within the actual patent account. Chapter 12.
Explanation:
Points 4 of 4
Received:
Comments:
2 Question: (TCO C) When developing computer software to be sold, which of the following costs
.
should be capitalized?

Your Answer:
Designing.

Coding.

Testing.

CORREC
None of the above.
T
Instructor Since the product is to be sold, it is considered to be an expense (R&D). Chapter 12.
Explanation: Pages 614-617.
Points 4 of 4
Received:
Comments:
3 Question: (TCO C) Jeff Corporation purchased a limited-life intangible asset for $120,000 on
.
May 1, 2008. It has a useful life of 10 years. What total amount of amortization
expense should have been recorded on the intangible asset by December 31, 2010?

Your Answer:
$ -0-

$24,000

CORREC
$32,000
T
$36,000
Instructor ($120,000 ÷ 10) × 2 2/3 = $32,000. Chapter 12
Explanation:
Points 4 of 4
Received:
Comments:
4 Question: (TCO C) On January 2, 2011, Klein Co. bought a trademark from Royce, Inc. for
.
$1,000,000. An independent research company estimated that the remaining useful
life of the trademark was 10 years. Its unamortized cost on Royce's books was
$800,000. In Klein's 2011 income statement, what amount should be reported as
amortization expense?

Your Answer: CORREC


$100,000.
T
$ 80,000.

$ 50,000.

$ 40,000.

Instructor $1,000,000 ÷ 10 = $100,000. Chapter 12.


Explanation:
Points 4 of 4
Received:
Comments:
5 Question: (TCO C) The following information is available for Barkley Company's patents:
.

Barkley would record a loss on impairment of

Your Answer:
$ 60,000.

CORREC
$210,000.
T
$860,000.

$920,000.

Instructor $860,000 - $650,000 = $210,000. Chapter 12.


Explanation:
Points 4 of 4
Received:
Comments:
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