Flashcards in Chapter 9(part 2) Deck (19):
-ordinary repairs and maintenance
-large amounts of $$$$$$
Depreciation is important to what time periods?
systematic allocation of the cost of a natural resource to future periods in which asses contribute services
cr:accumulated depletion or asset
allocation of the cost of an intangible asset to future periods in which the assets contribute services
cr: accumulated amortization or asset
Points on Intangible Assets
-have no physical substance
-provide future benefits
-benefits are derived from legal rights
-must acquired so they have a cost
-have a limited life
Examples of Intangible Assets
-patents, franchises and licenses, goodwill, trademarks, copyrights, and organizational cost
Research and Development
expensed in the period incurred
-patents have to be purchased or defended to be an asset
-those developed in-house are treated as expenses
is a result of increased earnings potential due to nme recognition/good reputation
-business can only record goodwill if it is paid for in connection with the purchase of an on-going business
a permanent decline in the market value of an asset is an impairment period in which the decline occurs.
-written down to new market value
What does the FASB require in regards to recognition on losses?
Goodwill is analyzed for what?
impairment rather than amortized
Where do we disclose the method of depreciation?
good will formula
fmv- purchase price
gain or loss formula
give the owner the exclusive right to reproduce an sell and artistic or published work
trademark or name
word phrase......etc that distinguishes or identifies a particular enterprise or product
is a contractual agreement under which the franchisor grants the franchisee the right to sell certain products
-perform specific services
-use certain trademarks