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Exam 11: Intangible Assets

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Question 1

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According to AASB 138 Intangible Assets,activities undertaken in the 'research' phase of the generation of an asset may include:

A) the application of knowledge to a design for the production of new materials.
B) original and planned investigation with the prospect of gaining new scientific knowledge.
C) the use of research findings to create a substantially improved product.
D) using knowledge to materially improve a manufacturing device.

E) None of the above
F) All of the above

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Question 2

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Which of the following intangibles may be capitalised as an asset by an entity?

A) Goodwill acquired as part of a business combination.
B) Internally generated mastheads.
C) Publishing titles developed within the entity.
D) Customer lists developed by the entity's marketing division.

E) All of the above
F) B) and D)

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Question 3

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Goodwill may only be recognised as an intangible asset when it is acquired as part of a business combination.

The characteristic that separates assets such as property,plant and equipment from intangible assets is:

In accordance with AASB 3 Business Combinations,if an intangible asset is acquired in a business combination,the cost of the asset is its:

Financial statements do not recognise any attempts by management to increase the human capital of the organisation.

Customer service capability does not qualify for recognition as an intangible asset because it does not meet the identifiability criterion.

Physical capital is a separate component of intellectual capital.

The cost of an intangible asset is comprised of the purchase price:

If the cost of an intangible asset cannot be measured reliably but the fair value can be determined,under AASB 138 Intangible Assets it can be recognised.

Physical form is not essential to the existence of an asset.

Assets that could potentially meet the identifiability criteria for intangible assets include which of the following?

Amounts spent on intangible assets cannot be capitalised if they have previously been expensed.

Amortisation of an intangible with a finite useful life does not cease when the asset becomes temporarily idle or is retired from active use.

AASB 138 Intangible Assets,requires that an intangible asset with a finite life:

From an accounting perspective,expenditure on development is:

When an intangible asset is separately acquired,the probability test will always be met as the price paid for the asset automatically takes into account the probability of the expected benefits being received.

Lewis Limited was involved in a mining exploration business.It commenced a project to design more efficient gold-detecting equipment.The following expenditures occurred during the financial year ended 2014: researcher's salary $5000,research consumables $3000,re-development of the detecting equipment $4000 and final adjustments to the detecting equipment $2500.The amount to be capitalised by this company as an intangible asset,for the 2014 financial year,is:

Under AASB 138 Intangible Assets,an intangible asset with an indefinite useful life is:

The application of research findings to a plan for the production of new materials before the start of commercial production is described as: