33. A patent infringement suit may either be successful or unsuccessful. Which of the following statement is true? If the lawsuit is successful the cost of this lawsuit is expensed If the lawsuit is unsuccessful, the cost is recognized as amortization expense If the lawsuit is successful the cost is an impairment If the lawsuit is successful, the cost is capitalized

33. A patent infringement suit may either be successful or unsuccessful. Which of the following statement is true? If the lawsuit is successful the cost of this lawsuit is expensed If the lawsuit is unsuccessful, the cost is recognized as amortization expense If the lawsuit is successful the cost is an impairment If the lawsuit is successful, the cost is capitalized

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter6: Losses And Loss Limitations

Section: Chapter Questions

Problem 1BCRQ

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Which of the following statements is true? Question 2 options: a The capitalizable costs of patents are legal fees and other registration costs. b An identifiable tangible asset developed internally is never recognized in the accounts as an asset. c Intangible assets usually have a residual value that must be considered in the amortization of cost. d An intangible asset is usually amortized by a credit to an income account.
Q21 Which of the following is NOT a step in impairment testing? Select one: a. Sell the asset after if the fair value is greater than the recoverable amount b. Calculate the asset’s carrying amount in the books of the entity c. Calculate the recoverable amount of the asset d. Assess whether there are circumstances that may indicate that the asset should be impaired.
94 2. According to the revised Conceptual Framework, the asset is a right, while the liability is the obligation, rather than ultimate inflows or outflows of economic benefits resultin from the asset or liability. 3. Legal enforceability of a right, for example ownership necessary for control over an economic resource to exist 4. According to the revised Conceptual Framework, an asset exist even if the probability that it will provide inflows future economic benefits is low, and even if the asset is subie to a high measurement uncertainty. 5. According to the revised Conceptual Framework, what the entin controls is the right, and not the ultimate inflows of futu economic benefits that the economic resource may produce. 6. The Conceptual Framework defines income and expenses in terms of changes in assets and liabilities. 7. Not all items that meet the definition of a financial statement element are recognized; they are recognized only if recognizing them will also result in relevant and…
Costs that are capitalized with regard to a patent include a. Legal fees of obtaining the patent, incidental costs of obtaining the patent, and costs of successful patent infringement suits. b. Legal fees of obtaining the patent, incidental costs of obtaining the patent, and research and development costs incurred on the invention that is patented. c. Legal fees of obtaining the patent, costs of successful patent infringement suits, and research and development costs incurred on the invention that is patented. d. Incidental costs of obtaining the patent, costs of successful and unsuccessful patent infringement suits, and the value of any signed patent licensing agreement.
Is it true that legal enforceability of a right, for example ownership, is necessary for control over an economic resource to exist?
Direction: Choose the correct answer. 1. A provision is a. An event which is not recognized because it is not probable or cannot be measured reliably b. An event which is probable and measurable c. An event which is probable, possible or remote and measurable. d. An evet which is probable but not measurable. 2.Which of the following statements is true? a. Vested and unvested past service cost shall be amortized over the remaining vesting period. b. Vested past service cost shall be recognized as expense and unvested past service cost shall be amortized over the remaining vesting period. c. Vested and unvested past service cost shall be recognized in retained earnings d. Vested and unvested past service cost shall be expense immediately. 3. In computing basic earning per share, an entity would include which of the following? a. Dividends on nonconvertible cumulative preference shares b. Dividend on ordinary shares c. Interest on convertible bonds d. Number of nonconvertible…
20. For an SME, changes in the fair value less costs to sell of biological assets are a. recognized in profit or loss b. recognized in other comprehensive income c. not recognized d. a or b
14-The amount for which an asset could be exchanged, a liability settled , or an equity instrument could be exchanged between knowledgeable parties is referred to as a. Historical cost principle b. Futuristic cost principle c. Replacement cost Principle d. Fair value cost principle
The amount for which an asset could be exchanged, a liability settled , or an equity instrument could be exchanged between knowledgeable parties is known as _________ a. Fair value cost principle b. Historical cost principle c. Futuristic cost principle d. Replacement cost Principle
Q10 Which of the following statement is NOT correct? Select one: a. When the carrying amount of an asset is less than the recoverable amount, then an asset should have its previous impairments reversed to the value of the recoverable amount provided there is accumulated amortization to cover the difference. b. The difference between the carrying amount of an asset and the recoverable is the impairment loss if the carrying amount is greater. c. When the carrying amount of an asset is greater than the recoverable amount, then an asset should be impaired to the value of the recoverable amount d. The difference between the carrying amount of an asset and the recoverable is the impairment loss if the carrying amount is less.
Are litigation costs to defend an intangible asset capitalized or expensed? Explain your answer.
17 The accounting book value of an asset represents the historical cost of the asset rather than its current market value or replacement cost. Select one: True False