Ac551 Week 1 Hw

1. Investment in a subsidiary company.

2. Timberland.

3. Cost of engineering activity required to advance the design of a product to the manufacturing stage.

4. Lease prepayment (6 months’ rent paid in advance).

5. Cost of equipment obtained.

6. Cost of searching for applications of new research findings.

7. Costs incurred in the formation of a corporation.

8. Operating losses incurred in the start-up of a business.

9. Training costs incurred in start-up of new operation.

10. Purchase cost of a franchise.

11. Goodwill generated internally.

12. Cost of testing in search for product alternatives.

13. Goodwill acquired in the purchase of a business.

14. Cost of developing a patent.

15. Cost of purchasing a patent from an inventor.

16. Legal costs incurred in securing a patent.

17. Unrecovered costs of a successful legal suit to protect the patent.

18. Cost of conceptual formulation of possible product alternatives.

19. Cost of purchasing a copyright.

20. Research and development costs.

21. Long-term receivables.

22. Cost of developing a trademark.

23. Cost of purchasing a trademark.

(a). Intangible assets in the balance sheet:

10. Purchase cost of a franchise.

13. Goodwill acquired in the purchase of a business.

15. Cost of purchasing a patent from an inventor.

16. Legal costs incurred in securing a patent.

17. Unrecovered costs of a successful legal suit to protect the patent.

19. Cost of purchasing a copyright.

23. Cost of purchasing a trademark.

(b). Other intangible items reported on income statement as:

1. Investment in a subsidiary company: long-term investments.

2. Timberland: property, plant, & equipment.

3. Cost of engineering activity required to advance the design of a product to the manufacturing

stage: research and development expense.

4. Lease prepayment (6 months’ rent paid in advance): prepaid rent becomes current asset.

5. Cost of equipment obtained: property, plant, & equipment.

6. Cost of...