Chapter 9 Flashcards
Research and development is ________
expensed as incurred
How are start up costs treated
- Expensed in financial reporting
how often must an intangible asset with an indefinite useful life be tested for impairment?
At least once every year.
what are the two steps of impairment testing for intangible assets?
- Qualitative
2. Quantitative
Are impairment losses reversible?
no they are non reversable
how are successful litigation costs of a patent handled?
They are capitalized
how are unsuccessful litigation costs of a patent handled?
They are expensed
IFRS allows for reevaluation of a previous impaired intangible asset if?
An active market exists for it.
Is goodwill amortized
No it is tested for impairment once yearly
Good will is tested at what level
Reporting unit level
how is good will tested for impairment under IFRS
is whether the carrying amount of GCU exceeds its recoverable amount.
What level is goodwill tested at under IFRS
CGU (cash generating unit)
When is franchise fee revenue recognized?
Recognition is at the earliest time when the franchisor has substantially performed or satisfied all material services or conditions in relation to the franchise sale.
- The franchisor has no remaining obligation or intent to refund any cash or to forgive any debt,
- The franchisor has performed substantially all of the initial contracted services, and
- No other relevant material obligations or conditions exist.
When will computer Software costs begin to be capitalized.
Technological feasibility is established when either a detailed program design is complete or the entity has created a working model.
capitalized software costs are recorded at?
lower of unamortized cost or NRV
