Question 1

Which statement is not correct?

Accepted Answer

A) The three phases in mining activities are: mineral exploration,development and extraction. 
B) The accounting for mineral exploration is conceptually similar to that for research activities. 
C) Mineral exploration costs can be capitalized because markets for mineral resources are well established. 
D) A mineral site entering the development phase would normally satisfy the six criteria required for capitalization. 
A) The three phases in mining activities are: mineral exploration,development and extraction. 
B) The accounting for mineral exploration is conceptually similar to that for research activities. 
C) Mineral exploration costs can be capitalized because markets for mineral resources are well established. 
D) A mineral site entering the development phase would normally satisfy the six criteria required for capitalization.

Question 2

Which of the following is NOT a "class" of intangible assets?

Accepted Answer

A) Industrial designs. 
B) Raw materials. 
C) Patents. 
D) Computer software. 
A) Industrial designs. 
B) Raw materials. 
C) Patents. 
D) Computer software.

Question 3

Explain the accounting for assets in the mineral resource exploration industry.

Accepted Answer

•Enterprises engaged in mineral explorat

Question 4

Which of the following is correct with respect to the accounting for re-payment of government grants?

Accepted Answer

A) Accounted for prospectively under IFRS. 
B) Accounted for retrospectively under ASPE. 
C) Accounted for prospectively under ASPE 
D) Accounted for retrospectively under IFRS. 
A) Accounted for prospectively under IFRS. 
B) Accounted for retrospectively under ASPE. 
C) Accounted for prospectively under ASPE 
D) Accounted for retrospectively under IFRS.

Question 5

Explain the difference between indefinite lived and finite lived intangible assets.

Accepted Answer

•An intangible asset has an indefinite l

Question 6

Explain how goodwill arises in a business.Give an example in your response.

Accepted Answer

Accounting goodwill represents the diffe

Question 7

GoodResources incurred the following costs:
 
How much would be capitalized as "property,plant or equipment" under the full cost method?

Accepted Answer

A) $100,000 
B) $200,000 
C) $300,000 
D) $700,000 
A) $100,000 
B) $200,000 
C) $300,000 
D) $700,000

Question 8

Assume that a company has spent $1 million during the year and is deciding whether these costs should be expensed as research costs or capitalized as development costs.Explain the impact of undercapitalization of development costs on the financial statements.

Accepted Answer

The criteria to permit capitalization of

Question 9

Which statement is correct?

Accepted Answer

A) Capitalization of costs ceases when the post development phase begins. 
B) The development phase includes generating new ideas or searching for new materials. 
C) The project must meet IAS 38 criteria before research costs can be capitalized. 
D) The post development phase includes designing,constructing or testing a prototype. 
A) Capitalization of costs ceases when the post development phase begins. 
B) The development phase includes generating new ideas or searching for new materials. 
C) The project must meet IAS 38 criteria before research costs can be capitalized. 
D) The post development phase includes designing,constructing or testing a prototype.

Question 10

Which statement is correct?

Accepted Answer

A) Under IFRS,research costs must fulfill six specific criteria. 
B) Under IFRS,all research costs must be expensed as incurred. 
C) Development activities must be technically feasible. 
D) Adequate financial resources must exist to complete research activities. 
A) Under IFRS,research costs must fulfill six specific criteria. 
B) Under IFRS,all research costs must be expensed as incurred. 
C) Development activities must be technically feasible. 
D) Adequate financial resources must exist to complete research activities.

Question 11

Which statement is correct?

Accepted Answer

A) In the development phase,the mineral site is ready for mineral production. 
B) In the development phase,the mineral site is assessed for commercial viability. 
C) In the development phase,the mineral site is assessed for technical viability. 
D) In the development phase,the six criteria required for capitalization are met. 
A) In the development phase,the mineral site is ready for mineral production. 
B) In the development phase,the mineral site is assessed for commercial viability. 
C) In the development phase,the mineral site is assessed for technical viability. 
D) In the development phase,the six criteria required for capitalization are met.

Question 12

What factor will not affect the estimated useful life of a finite lived intangible asset?

Accepted Answer

A) Legal life of the asset. 
B) Technological obsolescence. 
C) Physical condition of the asset. 
D) Certainty of future cash flows. 
A) Legal life of the asset. 
B) Technological obsolescence. 
C) Physical condition of the asset. 
D) Certainty of future cash flows.

Question 13

Explain the accounting requirements for externally purchased intangibles and internally developed intangibles.

Accepted Answer

•Enterprises should capitalize the cost

Question 14

GoodResources incurred the following costs:
 
How much would be capitalized as "property,plant or equipment" under the successful efforts method?

Accepted Answer

A) $100,000 
B) $200,000 
C) $300,000 
D) $700,000 
A) $100,000 
B) $200,000 
C) $300,000 
D) $700,000

Question 15

In 2018,StartUp Inc.(SU)set up a new manufacturing facility in Manitoba.To encourage SU to set up its factory,the province provided equipment with a fair market value of $45,000 and an estimated useful life of 5 years using straight-line depreciation.What journal entry would be required in fiscal 2019,if the net method is used?

Accepted Answer

A) No entry is required. 
B) A credit to other comprehensive income - donated assets of $9,000. 
C) A credit to deferred income of $9,000. 
D) A credit to accumulated depreciation for $9,000. 
A) No entry is required. 
B) A credit to other comprehensive income - donated assets of $9,000. 
C) A credit to deferred income of $9,000. 
D) A credit to accumulated depreciation for $9,000.

Question 16

Which statement describes the "full cost" method?

Accepted Answer

A) A method of accounting that capitalizes costs of mineral exploration and evaluation only if the outcome is successful. 
B) A method of accounting that capitalizes costs of mineral exploration and evaluation only if the production is technically feasible. 
C) A method of accounting that capitalizes costs of mineral exploration and evaluation costs without regard to outcome. 
D) A method of accounting that capitalizes costs of mineral exploration and evaluation only if the production is commercially viable. 
A) A method of accounting that capitalizes costs of mineral exploration and evaluation only if the outcome is successful. 
B) A method of accounting that capitalizes costs of mineral exploration and evaluation only if the production is technically feasible. 
C) A method of accounting that capitalizes costs of mineral exploration and evaluation costs without regard to outcome. 
D) A method of accounting that capitalizes costs of mineral exploration and evaluation only if the production is commercially viable.

Question 17

GoodResources incurred the following costs:
 
How much would be recorded as depreciation expense under the full cost method?

Accepted Answer

A) $5,000 
B) $15,000 
C) $30,000 
D) $45,000 
A) $5,000 
B) $15,000 
C) $30,000 
D) $45,000

Question 18

Which of the following statements is correct about intangible assets that have an indefinite life span?

Accepted Answer

A) This is an infinite lived asset. 
B) The asset is expected to continue providing economic benefits for the foreseeable future. 
C) Management does not know how long the asset is expected to provide economic benefits. 
D) The asset has fixed and determinable cash flows. 
A) This is an infinite lived asset. 
B) The asset is expected to continue providing economic benefits for the foreseeable future. 
C) Management does not know how long the asset is expected to provide economic benefits. 
D) The asset has fixed and determinable cash flows.

Question 19

Patent Corp. ,a publicly accountable entity,purchased the following assets:
 
How much,if any,of the costs can be capitalized as intangible assets?

Accepted Answer

A) $0 
B) $30,000 
C) $62,000 
D) $77,000 
A) $0 
B) $30,000 
C) $62,000 
D) $77,000

Question 20

Patent Corp. ,a publicly accountable entity,purchased a company with the following assets and liabilities for $100,000:
 
How much goodwill should be recorded?

Accepted Answer

A) $47,000 
B) $53,000 
C) $70,000 
D) $100,000 
A) $47,000 
B) $53,000 
C) $70,000 
D) $100,000

Which statement is not correct?

Which of the following is NOT a "class" of intangible assets?

Explain the accounting for assets in the mineral resource exploration industry.

Which of the following is correct with respect to the accounting for re-payment of government grants?

Explain the difference between indefinite lived and finite lived intangible assets.

Explain how goodwill arises in a business.Give an example in your response.

GoodResources incurred the following costs: How much would be capitalized as "property,plant or equipment" under the full cost method?

Assume that a company has spent $1 million during the year and is deciding whether these costs should be expensed as research costs or capitalized as development costs.Explain the impact of undercapitalization of development costs on the financial statements.

Which statement is correct?

Which statement is correct?

Which statement is correct?

What factor will not affect the estimated useful life of a finite lived intangible asset?

Explain the accounting requirements for externally purchased intangibles and internally developed intangibles.

GoodResources incurred the following costs: How much would be capitalized as "property,plant or equipment" under the successful efforts method?

Which statement describes the "full cost" method?

GoodResources incurred the following costs: How much would be recorded as depreciation expense under the full cost method?

Which of the following statements is correct about intangible assets that have an indefinite life span?

Patent Corp. ,a publicly accountable entity,purchased the following assets: How much,if any,of the costs can be capitalized as intangible assets?

Patent Corp. ,a publicly accountable entity,purchased a company with the following assets and liabilities for $100,000: How much goodwill should be recorded?

Fundamentals of Financial Accounting Theory

Conceptual Frameworks for Financial Reporting

Accrual Accounting

Revenue and Recognition

Cash and Receivables

Inventories

Financial Assets

Property, plant and Equipment

Applications of Fair Value to Non-Current Assets

Filters

Exam 9: Intangible Assets, goodwill, mineral Resources, and Government Grants

Which statement is not correct?

Which of the following is NOT a "class" of intangible assets?

Explain the accounting for assets in the mineral resource exploration industry.

Which of the following is correct with respect to the accounting for re-payment of government grants?

Explain the difference between indefinite lived and finite lived intangible assets.

Explain how goodwill arises in a business.Give an example in your response.

GoodResources incurred the following costs: How much would be capitalized as "property,plant or equipment" under the full cost method?

Assume that a company has spent $1 million during the year and is deciding whether these costs should be expensed as research costs or capitalized as development costs.Explain the impact of undercapitalization of development costs on the financial statements.

Which statement is correct?

Which statement is correct?

Which statement is correct?

What factor will not affect the estimated useful life of a finite lived intangible asset?

Explain the accounting requirements for externally purchased intangibles and internally developed intangibles.

GoodResources incurred the following costs: How much would be capitalized as "property,plant or equipment" under the successful efforts method?

Which statement describes the "full cost" method?

GoodResources incurred the following costs: How much would be recorded as depreciation expense under the full cost method?

Which of the following statements is correct about intangible assets that have an indefinite life span?

Patent Corp. ,a publicly accountable entity,purchased the following assets: How much,if any,of the costs can be capitalized as intangible assets?

Patent Corp. ,a publicly accountable entity,purchased a company with the following assets and liabilities for $100,000: How much goodwill should be recorded?

Fundamentals of Financial Accounting Theory

Conceptual Frameworks for Financial Reporting

Accrual Accounting

Revenue and Recognition

Cash and Receivables

Inventories

Financial Assets

Property, plant and Equipment

Applications of Fair Value to Non-Current Assets

Filters