Test Bank Intermediate Accounting (Volume 1) 14th Canadian Edition By Kieso, Weygandt, Warfield, Wiley, Wiecek, McConomy

Test Bank For
Intermediate Accounting
(Volume 1) 14th Canadian
Edition By Kieso, Weygandt,
Warfield, Wiley, Wiecek,
McConomy
(All Chapters 0-12, 100%
Original Verified, A+ Grade)
All Chapters Arranged
Reverse: 12-0
This is The Original Test Ban
For 14th Canadian Edition
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,Intermediate Accounting, 14Ce (Kieso)
Chapter 12 Intangible Assets and Goodwill

1) Which of the following is NOT generally true of intangible assets and goodwill?
A) Many major public companies have significant amounts of intangible assets and goodwill
listed on their balance sheets.
B) The major assets of today's information and service providers are likely to be tangible.
C) The major assets of today's information and service providers are likely to be intangible.
D) Since identifying and measuring intangibles and goodwill is often difficult, they are not
always reported on the balance sheet.
Answer: B
Diff: 1
Learning Objective: Understand the importance of goodwill and intangible assets from a
business perspective and describe their characteristics.
Section Reference: The Business Importance and Characteristics of Goodwill and Intangible
Assets
CPA: Financial Reporting
Bloomcode: Knowledge
AACSB: Analytic

2) Which of the following best describes goodwill?
A) internal value generated by way of a brand image
B) the excess of fair value transferred to acquire a business over fair value amounts assigned to
identifiable assets
C) internal value generated by way of a company's charitable activities and philanthropic acts
D) a company's intentions to impact the community and environment in a favourable way
Answer: B
Diff: 1
Learning Objective: Understand the importance of goodwill and intangible assets from a
business perspective and describe their characteristics.
Section Reference: The Business Importance and Characteristics of Goodwill and Intangible
Assets
CPA: Financial Reporting
Bloomcode: Knowledge
AACSB: Analytic




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,3) The three main characteristics of intangible assets are
A) identifiability, non-physical existence, and nonmonetary nature.
B) identifiability, physical existence, and separability.
C) separability, identifiability, and nonmonetary nature.
D) physical existence, nonmonetary nature, and identifiability.
Answer: A
Diff: 1
Learning Objective: Understand the importance of goodwill and intangible assets from a
business perspective and describe their characteristics.
Section Reference: The Business Importance and Characteristics of Goodwill and Intangible
Assets
CPA: Financial Reporting
Bloomcode: Knowledge
AACSB: Analytic

4) Which of the following is NOT a type of intangible asset?
A) Trademark
B) Financial instrument
C) Patent
D) Copyright
Answer: B
Diff: 1
Learning Objective: Understand the importance of goodwill and intangible assets from a
business perspective and describe their characteristics.
Section Reference: The Business Importance and Characteristics of Goodwill and Intangible
Assets
CPA: Financial Reporting
Bloomcode: Knowledge
AACSB: Analytic




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, 5) Which of the following is INCORRECT about the measurement of purchased intangible
assets?
A) Purchased intangible assets are measured at cost, which is their fair value at acquisition.
B) Cost includes the acquisition cost and all expenditures necessary to make the intangible asset
ready for its intended use.
C) If an intangible asset is acquired due to a government grant, the asset is not recognized in the
accounting records as there is no cost to the entity receiving the intangible asset.
D) The cost of the intangible received in a nonmonetary exchange is the fair value of the
consideration given or the fair value of the intangible received, whichever is more clearly
evident.
Answer: C
Diff: 1
Learning Objective: Identify and apply the recognition and measurement requirements for
purchased intangible assets.
Section Reference: Recognition and Measurement of Intangible Assets at Acquisition
CPA: Financial Reporting
Bloomcode: Knowledge
AACSB: Analytic

6) Babel Corporation acquired all outstanding shares of Connor Ltd. for $2.1 million. Selected
information relating to Connor was as follows:
Fair value of identifiable net assets: $2.0 million
Book value of identifiable net assets: $1.6 million
Cash balance: $0.1 million

Babel will recognize goodwill of
A) $0.1 million.
B) $1.1 million.
C) $2.1 million.
D) $1.5 million.
Answer: A
Explanation: $2.1 million - $2.0 million = $0.1 million
Diff: 2
Learning Objective: Identify and apply the recognition and measurement requirements for
purchased intangible assets.
Section Reference: Recognition and Measurement of Intangible Assets at Acquisition
CPA: Financial Reporting
Bloomcode: Application
AACSB: Analytic




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