The exclusive right to use another company's name and to sell its products within a specified geographical area is a:

A) Patent.

B) Copyright.

C) Trademark.

D) Franchise.

Answer: D

A word, slogan, or symbol that distinctively identifies a company, product, or service is a:

A) Patent.

B) Copyright.

C) Trademark.

D) Franchise.

Answer: C

Research and development costs should be:

A) Expensed in the period incurred.

B) Expensed in the period they are determined to be unsuccessful.

C) Deferred pending determination of success.

D) Expensed if unsuccessful, capitalized if successful.

Answer: A

An exclusive 20-year right to manufacture a product or to use a process is a:

A) Patent.

B) Copyright.

C) Trademark.

D) Franchise.

Answer: A

The legal life of a patent is:

A) Forty years.

B) Twenty years.

C) Life of the inventor plus fifty years.

D) Indefinite.

Answer: B

The exclusive right to benefit from a creative work, such as a film, is a:

A) Patent.

B) Copyright.

C) Trademark.

D) Franchise.

Answer: B

The following financial information is from Cook Company:

The following financial information is from Cook Company:

Accounts Payable $ 55,000

Land $ 90,000

Inventory $ 10,500

Accounts Receivable $ 7,500

Equipment $ 8,000

Deferred Revenue $ 58,500

Short-Term Investments $ 20,000

Notes Receivable (due in 8 months) $ 45,500

Interest Payable $ 2,000

Patents $ 75,000

What is the total amount of long-term assets assuming the accounts above reflect normal activity?

A) $342,500.

B) $173,000.

C) $273,500.

D) $98,000.

Answer: B

The following financial information is from Cook Company:

Accounts Payable $ 55,000

Land $ 90,000

Inventory $ 10,500

Accounts Receivable $ 7,500

Equipment $ 8,000

Deferred Revenue $ 58,500

Short-Term Investments $ 20,000

Notes Receivable (due in 8 months) $ 45,500

Interest Payable $ 2,000

Patents $ 75,000

What is the amount of intangible assets assuming the accounts above reflect normal activity?

A) $95,000.

B) $75,000.

C) $120,500.

D) $140,500.

Answer: B

The following financial information is from Cook Company:

Accounts Payable $ 55,000

Land $ 90,000

Inventory $ 10,500

Accounts Receivable $ 7,500

Equipment $ 8,000

Deferred Revenue $ 58,500

Short-Term Investments $ 20,000

Notes Receivable (due in 8 months) $ 45,500

Interest Payable $ 2,000

Patents $ 75,000

What is the total amount of property, plant, and equipment assuming the accounts above reflect normal activity?

A) $90,000.

B) $98,000.

C) $165,000.

D) $110,000.

Answer: B

Productive assets that are physically used up or depleted are:

A) Equipment.

B) Land.

C) Land improvements.

D) Natural resources.

Answer: D

A company acquired an office building, land, and equipment in a single basket purchase. The fair values were $1,200,000, $600,000, and $200,000 for the building, land, and equipment, respectively. The company recorded the building for $1,080,000. What was the total purchase cost for all three assets?

A) $1,600,000.

B) $1,500,000.

C) $2,000,000.

D) $1,800,000.

Answer: D

A company acquired an office building on three acres of land for a lump-sum price of $2,400,000. The building was completely equipped. According to independent appraisals, the fair values were $1,300,000, $780,000, and $520,000 for the building, land, and equipment, respectively. At what amount would the company record the building?

A) $720,000.

B) $1,300,000.

C) $1,200,000.

D) None of these answer choices are correct.

Answer: C

A company purchased land, a building, and equipment for one price of $800,000. The estimated fair values of the land, building, and equipment are $100,000, $700,000, and $200,000, respectively. At what amount would the company record the land?

A) $80,000.

B) $90,000.

C) $100,000.

D) $800,000.

Answer: A