Exam 12: Intangible Assets and Goodwill

On June 30, 2017, Carter Ltd.exchanged 3,000 Butte Corp.common shares for a patent owned by Texas Corp.The Butte shares were acquired in 2015 for $160,000.At the exchange date, Butte common shares have a fair value of $90 per share, and the patent had a carrying value of $320,000 on Texas's books.Carter should record the patent at

On January 1, 2017, Muhlenberg Corp.bought a trademark from Glasgow Corp.for $160,000.An independent consultant retained by Muhlenberg estimated that the remaining useful life is 50 years.The trademark's carrying value on Yarmouth's books was $61,000.Muhlenberg decided to write off the trademark over the maximum period allowed.How much should be amortized for the year ended December 31, 2017?

In January, 2012, Tillicum Corp.purchased a patent for a new consumer product for $900,000.At the time of purchase, the patent was valid for fifteen years.Due to the competitive nature of the product, however, the patent was estimated to have a useful life of only ten years.During 2017, the product was permanently removed from the market because of a potential health hazard.What amount should Tillicum recognize as an impairment loss for calendar 2017, assuming amortization has been recorded annually using the straight-line method with no residual value?

A copyright is an example of a(n)

A franchise or licence with a limited life is

Purchased goodwill should be

Regarding trends in intangible asset reporting, which of the following statements is NOT true?

During 2017, Elysium Inc.incurred the following costs: Assuming the 6 specific conditions have been demonstrated, in 2017, Elysium Corp.would report development costs of

Intangible assets that have a finite life are amortized over a period NOT to exceed

If the pattern in which an intangible asset's benefits will be used up CANNOT be determined, the amortization method most likely to be used is

Grand Trunk Corp.incurred $160,000 of basic research and $50,000 of development costs to develop a product for which a patent was granted on January 2, 2012.Legal fees and other costs associated with registration of the patent totalled $60,000.On March 31, 2017, Grand Trunk paid $90,000 for legal fees in a successful defence of the patent.The total amount capitalized for the patent through March 31, 2017 should be

Under ASPE, which of the following statements best describes the accounting for intangible assets after acquisition?

Mindy Corporation acquired all outstanding shares of Lahiri Ltd.For $4.2 million.Selected information relating to Lahiri was as follows: Mindy will recognize goodwill of

Which of the following is the impairment test for indefinite-life intangibles?

Goodwill is the excess of purchase price of the acquired enterprise over

Which of the following is NOT generally true of intangible assets and goodwill?

The three main characteristics of intangible assets are

Use the following information for questions. Casper Corp.is planning to acquire a controlling interest in the outstanding shares of Frosty Inc.for $9.2 million in cash. -Assuming the fair value of Frosty's net assets is $12.5 million, and Casper acquires a 75% share, goodwill can be calculated as

At December 31, 2017, Walker Corp.'s general ledger includes the following account balances: In the preparation of Walker's balance sheet as of December 31, 20172017, what should be reported as total intangible assets?

A patent is an example of a(n)