Question 1

Which intangible asset is recorded only when an acquiring company purchases another company?

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Question 2

What would a manufacturer obtain to identify its merchandise and to bar other manufacturers from using the same identification?

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Question 3

The slogan "Can you hear me now?" for Verizon is a protected slogan called a:

Accepted Answer

"Can you hear me now?" is a slogan used by Verizon as a distinctive mark to denote their products and services. This makes it a trademark, which is a form of intellectual property protection for a brand's name and logo, and other designs or phrases that identify and distinguish the brand. A trademark helps to prevent competitors from using a similar or confusingly similar mark, and it can only be acquired through registration with the appropriate government agency. Therefore, option C, trademark, is the best choice.

Question 4

Copyrights to protect various forms of media are conveyed by the federal government for a period of __________.

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Question 5

Goodwill is:

Accepted Answer

Goodwill is not amortized but is tested annually for impairment. If it is determined that the goodwill has lost value, a loss is recorded to reflect the impairment.

Question 6

How are research and development costs (R&D) generally recorded?

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Question 7

A patent has amortization this year of $2,300. What is the journal entry to record the amortization?

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Question 8

Which of the following are generally rendered obsolete because of technological advancements?

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Question 9

How often should goodwill be tested for impairment under IFRS?

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Question 10

How is goodwill calculated?

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Question 11

Lobella Corporation purchased Melissa Industries on January 1, 2012. At the time of the purchase, the
market value of Melissa's assets is $920,000 and its liabilities total $580,000. Lobella pays $500,000 for Melissa. Calculate the Goodwill and record the journal entry to record the purchase.

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Question 12

A company pays $98,000 for a copyright and it is estimated that the useful life is ten years. What is the journal entry to record its amortization at year end?

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Question 13

Amortization is computed over the useful life of the intangible asset using the double-declining-balance method.

Accepted Answer

The double-declining-balance method is a type of accelerated depreciation method used for tangible assets, not intangible assets. Intangible assets are typically amortized using the straight-line method over their useful life.

Question 14

Carine Corporation purchased Matilda Industries on January 1, 2012. At the time of the purchase, the market value of Matilda's assets is $1,120,000 and its liabilities total $320,000. Carine pays $900,000 for Matilda. Calculate the Goodwill and record the journal entry to record the purchase.

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Question 15

Suppose goodwill that is carried on the balance sheet at its original value of $120,000 is valued at year end at $70,000. What is the journal entry required to record this?

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Question 16

The Toronto Blue Jays is an example of a:

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Question 17

Patents to produce and sell inventions are conveyed by the federal government for a period of __________.

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Question 18

Instead of using an accumulated amortization account similar to accumulated depreciation, the expense of amortization is directly credited to the intangible asset itself.

Accepted Answer

This is a common accounting practice for intangible assets. Instead of having a separate accumulated amortization account like accumulated depreciation for tangible assets, the expense of amortization is directly credited to the intangible asset account.

Question 19

Suppose Arian Industries pays $120,000 on January 1 to purchase a patent on a new manufacturing process. Arian Industries believes this patent's useful life is six years. Record the journal entries to record the purchase and the amortization.

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The answer of Suppose Arian Industries pays $120,000 on January...

Question 20

Levi's would be an example of a:

Accepted Answer

Levi's is a brand name, which is a term, name, design, symbol, or other feature that identifies a seller's product and distinguishes it from those of other sellers.

Quiz 8: Long-Term Assets