Learnsmart Ch. 7
Amortization
Allocation of cost of intangible asset.
Depletion
Allocation of cost of natural resources.
Depreciation
Allocation of cost of tangible fixed asset.
Trademark
An exclusive right to display a word, slogan, symbol, or emblem that distinctly IDs a company, product or service.
Capitalized
Purchase price plus the costs necessary to get asset ready for use.
Expensed
Research and developmental costs
Residual Value
The amount a company expects to receive for the asset at the end of its service life.
straight line and declining balance methods allocate the cost of a long term asset based on ______, while an activity based method allocated the cost of an asset based on its ____.
time, use
Patent
The exclusive right to manufacture a product or use a process granted for a period of 20 years.
Basket Purchase
When assets are purchased in a group for a single sum
Double declining balance method
book value at beginning of the year x 2 x 1 / service life
commonly used depreciation methods include
straight line, activity based and declining
book value of an asset
the original cost of the asset less accumulated depreciation.