FAR Module 11 Misc.

Question 0

T/F

Generally a cost should be capitalized if it improves the asset and expensed if it merely maintains the asset at its current level

Answer 0

TRUE

Question 1

An entities cash flows are expected to change significantly if the configuration of the cash flows of the asset received differs significantly from the configuration of the cash flows of the asset transferred.

For purposes of nonmonetary exchanges the configuration of Cash flows includes what

Answer 1

The risk, timing, and amount of cash flows of the assets.

Question 2

When management plans to dispose of long-lived assets and limited live intangibles the assets shall be reported at what amount

Answer 2

The lower of carrying amount or NRV (fair value less cost to sell)

Question 3

Under ASC topic 350 Goodwill should be tested periodically for impairment at what level

Answer 3

Goodwill is allocated to reporting units which are operating segments of the business or one level below. Goodwill is always tested for impairment at the level of the reporting unit.

Question 4

T/F

items that are held for resale will not have any costs that are capitalized

Answer 4

FALSE

costs that attach themselves to assets are those that are directly connected with bringing the goods or equipment to the place of business and converting such goods to a sellable (inventory) or usable (equipment) condition. Such costs that are directly connected to the assets are capitalized

Question 5

What is the journal entry to record goodwill impairment

Answer 5

Debit impairment loss

Credit Goodwill