Last topic for midterm

• If it is not clear whether an expenditure is a research or a development cost, it is treated as development cost.

  false
• If it is not clear whether an expenditure is a research or a development cost, it is treated as _______.

  research cost
• The development cost of an internally generate intangible asset may be capitalized if certain conditions are met.


  true
• A government entity does not amortize intangible assets.

  false
• Government entities amortize all of their intangible assets over a period of 2 to 10 years, unless a more appropriate estimate of useful life is available.

  false
• For subsequent measurement, government entities classify intangible assets into those with finite and indefinite useful lives, similar to business entities.

  true
• Subsequent expenditures on recognized intangible assets are generally expensed unless it is clear that the expenditures meet the recognition criteria for intangible assets.

  true
• A government entity acquires an intangible asset with indefinite useful life for P100. Assuming the entity uses the maximum amortization period for intangible assets under the GAM for NGAs, the appropriate annual amortization expense on the intangible asset is P10.

  false
• The amortization of an intangible asset is credited directly to the intangible asset account, according to the GAM for NGAs.


  false
• An entity determines an indication of impairment for the intangible asset with carrying amount of P100. The entity calculates a fair value less costs to sell of P90 and a value in use of P105. The impairment loss is P5.

  false