M4- Intangibles- patents and goodwill

Question 1

What type of costs are amortized over a patents life?

Answer 1

Legal fees used to SUCCESSFULLY defend a patent

Question 2

Software: prior to technology feasibility

Answer 2

Expense

Question 3

After feasibility but prior to production

Answer 3

Capitalize

Question 4

Expense incurred during production

Answer 4

Inventory

Question 5

During training on internal use of software

Answer 5

Expensed

Question 6

What are the four types of internally developed software that are capitalized

Answer 6

1. legal fees and other costs related to a successful defense of the asset
2. Registration of consulting fees
3. design costs (e.g., trademarks)
4. other direct costs to sure the assets

Question 7

What are the 2 exceptions to capitalizing R&D expenses?

Answer 7

1. Materials, equipment or facilities that have alternative future uses
2. R&D costs of any nature undertaken on behalf of the others under a contractual arrangement

Question 8

What is the only type of software expense that is capitalized

Answer 8

after feasibility but prior to production