1 Purchase price 300,000.

00
Legal Fees 40,000.00
Consulting fees 60,000.00
Acquisition cost 400,000.00

2 Annual Amortization Cost / Useful life or Legal Life whichever is shorter

400,000.00 10
Annual Amortization 40,000.00

3 Cost 400,000.00
Accumulated Amortization 120,000.00
Carrying Value 280,000.00
al Life whichever is shorter
2 Cost
Purchase price 120,000.00
Legal fees 15,000.00
Cost 135,000.00

Annual Amortization Cost / Estimated life

135,000.00 40
Annual Amortization 3,375.00

3 Cost 20,000,000.00
Estimated life 20.00
Annual Amortization 1,000,000.00

Cost 20,000,000.00
Accumulated Amortization 5,000,000.00
Carrying Value 15,000,000.00

Annual Amortization 1,000,000.00

Annua fee 100,000.00
Decrease in income 1,100,000.00
 Equity = Assets - Liabilities

Equity = 6,500,000.00

Equity =

Purchase Price 7,000,000.00

Value 6,500,000.00
Goodwill 500,000.00

5 Building 2,000,000.00
Salaries 100,000.00
R and Expense 2,100,000.00
Assets

AR 400,000.00
Building 5,800,000.00
Machinery 500,000.00
6,700,000.00

Liabilities
Bond Payable 200,000.00
 Capitalized Cost of Computer Software' 400,000.00

7 Cost
Accumulated Amortization
Carrying Value

Cost
Accumulated Amortization
Carrying Value
 2020 2021
50,000.00 50,000.00
5,000.00 10,000.00
45,000.00 40,000.00
0 1 The book value or carrying value of PPE is always equal to its fair market value
0 2 All property, plant, and equipment must be depreciated for accounting purposes.
0 3 In calculating depreciation, both plant assets cost and useful life are based on estimates.
1 4 Under the double-declining balance method, the depreciation rate used each year remains constant.
1 5 The depreciable cost of a plant asset cost and useful life are based on estimates
1 6 Ordinary repairs should be recognized as revenue expenditures when incurred.
1 7 Capital expenditures are costs that increase the company's investment in productive facilities
0 8 If proceeds from the sale of a plant assets exceed its book value, a loss on disposal occurs
0 9 Depletion expense is reported in the income statement as an operating expense
0 10 Natural resources are long lived productive assets that are extracted in operations and are replaceable by man
0 11 Goodwill is amortized and tested at least annually for impairment.
0 12 Customer list has indefinite useful life.
1 13 The cost of a patent must be amortized over a 20 year period
1 14 The brand name Coca-Cola is an intangible asset
1 15 Generally, research and development costs should be charged to expense when incurred.
0 16 When an entire business is purchased, goodwill is the excess of cost over the book value of the net assets acquired.
0 17 Development cost are capitalized only before technical and commercial feasibility of the asset for sale or use have been estab
1 18 Goodwill is not recognized in accounting unless it is acquired from another business enterprise
0 19 An intangible asset is identifiable when it cannot be separated from the entity itself.
0 20 Intangible assets derive their value from the right (claim) to receive.
placeable by man

the net assets acquired.

et for sale or use have been established.