answer me this accounting problem What basis governs the accounting for mineral depositdepletion rights?a) Straight-line over contract periodb) Units of production methodc) Fair market value adjustmentsd) Time-based amortization

a) Straight-line over contract period: INCORRECT• This method is mostly applied in Companies owning…

Answered: What basis governs the accounting for…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter12: Intangibles

Section: Chapter Questions

Problem 5GI

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FINANCIAL ACCOUNTING PROBLEM, EXPERT ANSWER THIS WITH EXPLANATION
1. What factors must a company consider when choosing an amortization method to use for a fixed asset? Be sure to refer to IFRS and the effect of the decision on the financial statements. 2. What is the Capital Cost Allowance and how does it affect the amortization of assets?
Borrowing costs on qualifying assets are? a) Always expensed b) Capitalized during the construction period c) Added to reserves d) Deducted from the asset cost
Which of the following amortization methods is most likely to evenly distribute the cost ofan intangible asset over its useful life?A. Straight-line methodB. Units-of-production methodC. Double-declining balance method
Explanation
Which statements are correct concerning measurement of cost of property, plant and equipment?I. The purchase price of an item of property, plant and equipment is the cash price equivalent at the date of recognitionII. If payment is deferred beyond normal credit terms, the difference between the cash price equivalent and total payment is recognized as interest expense over the life of the asset.III. If an item of property, plant and equipment is acquired in exchange for a nonmonetary asset or a combination of monetary and nonmonetary asset, the cost of such item is measured at fair value unless the exchange transaction lacks commercial substance or fair value of either asset received or given up is not reliably determinable.IV. If an entity is able to determine reliably the fair value of both the asset given up and asset received in an exchange, the fair value of the asset given up is used to measure the cost of asset received in exchange.
the amortization of intangible assets with finite useful lives is justified by the : a- economic entity assumption b- going concern assumption c- monetary unit assumption d- historical cost assumption
Valuing assets at the amount of cash or equivalents paid or the fair value of the consideration given to acquire them at the time of acquisition most closely describes which measurement of fi nancial statement elements? A . Current cost
The allocation of the cost of a tangible asset to expense in the periods in which the asset is used is termed as: Select one: a. Depreciation b. None of the given options c. Appreciation d. Fluctuation
Which of the following values for an intangible asset would a company capitalize and amortize? a.) purchase price b.) research costs c.) residual value d.) development costs

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What basis governs the accounting for mineral deposit depletion rights? a) Straight-line over contract period b) Units of production method c) Fair market value adjustments d) Time-based amortization