ACT210 - Exam 3

Which one of the following regarding the book value of an asset is correct?

It reflects the original cost of the asset less accumulated depreciation.

serial bonds

bonds that mature in installments

Book value of an asset

original cost of the asset less accumulated depreciation.

Patent

20 year exclusive right to manufacutre a product or to use a process

Trademark

A word, slogan, or symbol that identifies a company, product or service. Protected for 10 years and can be renewed.

Bonds payable should be reported as a long-term liability in the balance sheet at:

Carrying value.

Franchise

Local outlets the pay for the exclusive right to use the franchisor's company name and sell its products.

Liabilities

Resources owed by an entity as a result of past transactions.

Assets

Resources owned by an entity as a result of past transactions.

Copyright

The exclusive right of protection given to the writer of a published work. Exclusive rights are given for the life of the creator plus 70 years.

Ordinarily, the proceeds from the sale of a bond issue will be equal to:

The present value of the face amount plus the present value of the stream of interest payments.

Capitalize

delay the recognition of expenses by recording the expense as a long-term asset

Which of the following are employer payroll costs? I. FICA taxes. II. Federal and state unemployment taxes. III. Federal and state income taxes. IV. Employer contributions to a retirement plan.

i, ii, iv

Goodwill

intangible asset that arises when a buyer acquires an existing business.Not amortized.

Term bond

matures on a single date