Exam 8: Investing Activities

Under U.S.GAAP,when an asset's carrying amount is deemed _______________,the asset is considered impaired.

All of the following are typically costs that fail the future benefits test of long-lived operating assets except:

Securities that are purchased in order to take advantage of short-term changes in market value should be classified as ____________________ securities.

When a foreign entity operates as a relatively self-contained and integrated unit within a foreign country,normally,its functional currency is the ____________________________________________________________.

Using the information below,calculate the average total depreciable life of the assets:

For U.S.GAAP,software development costs are capitalized as intangible assets:

Solo Corp.purchased $500,000 of bonds for $515,000 as an investment.If Solo expects to hold the bonds until they mature,the initial investment should be recorded at:

GAAP stipulates that firms should do what with expenditures that increase the service potential of an asset beyond that originally anticipated?

The ____________________ method views a corporate acquisition as conceptually identical to the purchase of any single asset.

When the functional currency is the U.S.dollar,financial reporting requires firms to use the ___________________________________ translation method.

Under IFRS,when an asset is revalued upwards,subsequent depreciation is based on:

Record Corporation CD Inc.acquires 100% of the outstanding shares of Record Corp.for $1,200,000 and accounts for the transaction using the purchase method.Record Corp's balance sheet at the date of acquisition appears below: -Based on the information concerning Record Corp. ,what amount of goodwill should CD record at the acquisition date?

___________________________________ include trade and brand names,trademarks,patents,copyrights,franchise rights,customer lists and goodwill.

All of the following are types of intercorporate investments in capital stock except:

Harbour Company purchased a new piece of equipment with a list price of $200,000 and subject to a 6 percent discount if paid within 45 days.Harbour paid within the discount period.The company also paid $1,650 to obtain title to the equipment and $650 as the license fee for the first year of operation.It paid $2,475 to level the area in which the equipment would be located and $11,750 to relocate other equipment that would have interfered with the proper operation of the new equipment.Harbour paid $500 for property and liability insurance for the first year of operation.What is the acquisition cost of this equipment that Harbour should record in its accounting records? Indicate the treatment of any amount not included in acquisition cost.

When a long-lived asset loses its ability to generate future benefits,U.S.GAAP requires firms to write down the assets to their fair values and recognize a(n)______________________________ in income from continuing operations.

Olivia Co.owns 5,600 of the 14,000 outstanding shares of Hobbitt Corp.common stock and exercises significant influence over the company.During 2011,Hobbitt earns $90,000 and pays cash dividends of $25,000.If the beginning balance in the investment account was $190,000,the balance at December 31,2011 should be:

When a foreign entity operates as a direct and integral extension of the U.S.parent,normally,its functional currency is the _________________________.

Financial reporting requires firms to ____________________ immediately all R&D costs incurred internally.

When a firm can exercise control or significantly influence the operations of a company it has only a minority interest in,it should account for the investment using the ______________________________.