Intangible Assets and Impairment Quiz

15 multiple-choice questions with answers and explanations · 2 easy, 6 medium, 7 hard

Intangible assets, research and development, goodwill, and testing assets and cash-generating units for impairment.

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  1. 1Classifying a CopyrightA purchased copyright is reported in the statement of financial position as:easy
  2. 2US GAAP: Research and Development CostsA company incurs development costs on a project that is technically feasible and expected to be profitable. Under US GAAP these costs are generally:easy
  3. 3IAS 38 — Research vs Development CostsUnder IAS 38, expenditure on the RESEARCH phase of an internal project is:medium
  4. 4Indefinite-Life Intangible AssetsAn acquired brand assessed as having an INDEFINITE useful life is:medium
  5. 5Amortizing a Finite-Life Intangible AssetA finite-life intangible asset — for example, a patent used for its full 10-year legal life — is:medium
  6. 6Theory: Impairment Loss CalculationAn asset has a carrying amount of $500,000 and a recoverable amount of $430,000. What is the impairment loss?medium
  7. 7US GAAP: Internal-Use Software Development CostsUnder US GAAP, costs incurred during the APPLICATION DEVELOPMENT stage of internal-use software are:medium
  8. 8US GAAP: Reversing an Impairment Loss on an Asset Held for UseA long-lived asset held for use was impaired in a prior year. Its fair value has since recovered. Under US GAAP the company:medium
  9. 9IAS 36 — Computing the Impairment LossA machine has a carrying amount of $100,000. Its fair value less costs to sell is $78,000 and its value in use is $85,000. The impairment loss recognized under IAS 36 is:hard
  10. 10IAS 36 — Reversing an Impairment LossAn asset impaired in a prior year has recovered in value. Under IAS 36, the impairment loss:hard
  11. 11Allocating an Impairment Loss to a CGU With GoodwillWhen an impairment loss is recognized for a cash-generating unit (CGU) that includes goodwill, the loss is allocated:hard
  12. 12US GAAP: The Impairment Recoverability TestUnder ASC 360, an entity tests a long-lived asset held for use for impairment by first comparing its carrying amount with:hard
  13. 13US GAAP: Measuring the Impairment LossA long-lived asset fails the ASC 360 recoverability test. The impairment loss recognized equals the carrying amount less:hard
  14. 14US GAAP: Computing an Impairment LossEquipment has a carrying amount of $900,000. Undiscounted expected future cash flows are $850,000 and its fair value is $700,000. Under US GAAP the impairment loss is:hard
  15. 15US GAAP: When the Recoverability Test Is PassedEquipment has a carrying amount of $600,000, undiscounted expected future cash flows of $640,000, and a fair value of $520,000. Under US GAAP the impairment loss is:hard

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Intangible Assets challenges 4Impairment challenges 4

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