IA 1 - Intangible (CHAP 34) Flashcards
Patent is an example of which category of intangible asset?
a. Market-related
b. Customer-related
c. Artistic-related
d. Technology-based
d. Technology-based
A patent should be amortized over
a. Twenty years
b. The useful life
c. The useful life or twenty years, whichever is longer
d. The useful life or twenty years, whichever is shorter
d. The useful life or twenty years, whichever is shorter
When a patent is amortized, the credit is usually made to
a. The patent account
b. As accumulated amortization account
c. An accumulated depreciation account
d. An expense account
a. The patent account
When an entity successfully defended a patent from infringement by a competitor, the cost of successful litigation should be
a. Amortized over the legal life of the patent.
b. Amortized over five years.
c. Expensed in the period when incurred.
d. Amortized over the remaining useful life of the patent.
c. Expensed in the period when incurred.
The cost of purchasing right for a product that might otherwise have seriously competed with the purchaser’s patented product should be
a. Charged off in the current period.
b. Amortized over the legal life of the purchased patent.
c. Added to factory overhead.
d. Amortized over the remaining useful life of the patent for the product whose market would have been impaired by competition from the newly patented product.
d. Amortized over the remaining useful life of the patent for the product whose market would have been impaired by competition from the newly patented product.
A trademark is an example of which category of intangible asset?
a. Market-related
b. Customer-related
c. Artistic-related
d. Contract-based
a. Market-related
Which should not be capitalized as cost of trademark?
a. Cost of successful litigation of the trademark
b. Registration with Intellectual Property Office
c. Design cost
d. Legal fee
a. Cost of successful litigation of the trademark
Which cost associated with a trademark should not be capitalized?
a. Attorney fee
b. Consulting fee
c. Research and development fee
d. Design cost
c. Research and development fee
What is the legal life of trademark?
a. 10 years
b. 20 years
c. 10 years and renewable after every 10 years
d. 20 years and renewable after every 20 years
c. 10 years and renewable after every 10 years
Which statement is incorrect in relation to trademark?
a. A trademark can be regarded as an intangible asset with an indefinite useful life.
b. A trademark is an identifiable intangible asset.
c. A trademark with indefinite useful life is not amortized but tested for impairment at least annually.
d. A trademark is amortized and tested for impairment whenever there is an indication of impairment.
d. A trademark is amortized and tested for impairment whenever there is an indication of impairment.
A copyright is an example of which category of intangible asset?
a. Market-related
b. Customer-related
c. Artistic-related
d. Contract-based
c. Artistic-related
Franchise is an example of which general category of intangible asset?
a. Market-related
b. Customer-related
c. Artistic-related
d. Contract-based
d. Contract-based
Customer list and order backlog are an example of which general category of intangible asset?
a. Market-related
b. Customer-related
c. Artistic-related
d. Contract-based
b. Customer-related
Copyright should be amortized over
a. The legal life
b. The life of the creator plus fifty years
c. Twenty years
d. The useful life or legal life, whichever is shorter
d. The useful life or legal life, whichever is shorter
Which of the following should be expensed as incurred by the franchisee for a franchise with finite useful life?
a. Amount paid to the franchisor for the franchise
b. Payment to an entity, other than the franchisor, for that entity’s franchise
c. Legal fees paid to obtain the franchise
d. Periodic payments to the franchisor based on the franchisee’s revenue
d. Periodic payments to the franchisor based on the franchisee’s revenue
