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What is the definition of goodwill from an asset valuation perspective? From an income perspective?
Under what conditions is goodwill capitalized at acquisition? Expensed at acquisition?
Distinguish between internal and external goodwill. In which situations is each capitalized or expensed
Explain how research and development expenditures are treated under IFRS.
At the end of 2011, the corporation believes the fair value of the trademark is $189,000. Record the impairment loss for Steel Magnolia.
$23,000 in payroll costs for employees working on the project, and $3,500 in interest costs while developing the software.
At what amount should the company capitalize the patent? How would you determine the economic life of the patent?
On January 3, 2011, the company paid its lawyers $10,000 for successfully defending the patent in a lawsuit.
Compute the ending carrying value of the tradename for 2010 and 2011. Should the company amortize the tradename?
The machine was not suitable for use in production activities and was not expected to be used in other research projects.
Testing a new type of machine to evaluate its potential usefulness in production.
Which of the following are included in R&D costs of the current period? Justify each answer.
How much amortization expense should the company recognize on each intangible asset in 2010?
Prepare the journal entry (if any) for Probst Company to record the impairment of its trademark at the end of 2010.
Blaha Company estimates that the fair value of the subsidiary is $720,000, of which it allocates $660,000 to the subsidiary's identifiable assets.
On January 2, 2010, the Paul Company purchased the Marino Company by acquiring all its outstanding shares for $300,000 cash.
Purchased the rights to a novel by a best-selling novelist in exchange for 10,000 shares of $10 par value common stock selling for $60 per share.
Paid an advertising agency $60,000 to develop a two-year advertising campaign to promote a new tradename.
The company had capitalized $57,000 to the Patent account at the beginning of 2009 for the cost of a patent.
Sold a prototype machine for $7,000. The research and development were performed in previous years.
What is the amount of Cressman's research and development expenses for 2010 if it uses U.S. GAAP?
The company purchased the net assets of Lansing Company on September 1, 2010, for $950,000, and the Lansing Company was liquidated.
How would your answer change if the projected sales were considered to be "probable"?
Identify something you want to change in the company and identify and explain the impact of the change.
Ascertain the legal liability to third parties who relied on financial statements under both common and federal securities laws.