Chapter 31 Flashcards
Current Ratio
Quick Ratio
Cash Ratio
long-term debt-to-equity ratio
total debt-to-equity ratio
debt ratio
financial leverage ratio
Identifiable vs Unidentifiable Intangibles
Identifiable:
- can be acquired, linked to rights and privileges having finite benefits, amortized.
- Reported on BS
Unidentifiable:
- cant be acquired, may have indefinite benefit period, example is good will. Not amortized
Under IFRS, for research and dev stage, do we expense or cap?
Research we expense
Development we cap.
Intangible assets examples and exclusions
Exclusions: internally generated intangibles
Typical intangibles
- Purchased patents and copyrights
- purchased brands and trademarks
-Direct response ads
- purchased franchise and license cost
-Goodwill
-Comp software dev cost.
Expensed intangible items examples
R&D under IFRS
R&D is expensed for initial research.
Other then that its cap if :
- Project is technically feasible
- Resources exist to complete project
- market exists for the product
- co has intention to complete and sell product.
Goodwill Intangible, 5 important points:
- NOT Amortized
- On balance sheet
- Internally generated good will is EXPENSED as incurred.
- Fair value
- require annual impairment review.
Goodwill Impairment - what does it indicate, and where do you remove the impact of good will from ratios?
