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Ias 38 - Group 5
Ias 38 - Group 5
TRUE OR FALSE:
MULTIPLE CHOICE:
3. The following are examples of expenditures that are not part of the cost of an intangible
asset, except?
A. Costs of introducing a new product or service (including costs of advertising and
promotional activities);
B. Professional fee
C. Costs of conducting business in a new location or with a new class of customer
(including costs of staff training); and
D. administration and other general overhead costs.
4. What are the factor that are considered in determining the useful life of an intangible asset?
I. Technical, technological and other type of obsolescence
II. Unexpected usage of the asset by the entity
III. Stability of the industry which the asset operates
IV. Level of maintenance required to obtain the expected useful future economic benefits
from the asset.
A. I only
B. I & II
C. I, III, IV
D. ALL OF THE ABOVE
5. The following are the three essential criteria in the definition of an intangible asset, expect:
A. Inseparability
B. Identifiability
C. Control
D. Future economic benefits
9. Broadcast rights and franchises are an example of which category of intangible asset?
A. Market-related
B. Customer-related
C. Artistic-related
D. Contract-based
11. The three critical attributes of an intangible asset are the following except:
A. Identifiability
B. Control
C. Future economic benefits
D. Recognition of liability
16. Goodwill does not fall within the IAS38 definition of an intangible asset because:
A. It is a monetary asset
B. It is not separable
C. It may not generate future economic benefits
D. None of the above
17. Which of the following would not be included in the cost of a separately acquired intangible
asset?
A. Non-refundable value added tax
B. Employee costs incurred in preparing the asset for its intended use
C. Costs incurred in using the asset
D. Testing costs
18. How should research and development expenditure be dealt with in an entity's financial
statements?
A. Research and development expenditure should always be written off as an expense
B. Research and development expenditure should always be capitalised as an intangible
asset
C. Research expenditure should always be written off as an expense but development
expenditure should always be capitalised as an intangible asset
D. Research expenditure should always be written off as an expense but development
expenditure should be capitalised as an intangible asset if it satisfies certain conditions
19. The revaluation model cannot be used for the measurement of an intangible asset unless:
A. The asset is revalued every year
B. The fair value of the asset is determined by a professional valuer
C. There is an active market in that type of asset
D. The revaluation model is also used for tangible assets
20. The amortisation method used in relation to an intangible asset should be chosen so as to:
A. Write off the asset as soon as possible
B. Reflect the usage pattern of the asset
C. Evenly spread the cost of the asset over its useful life
D. Maximise the amortisation charge in the early years of the asset's useful life
IAS 38 ASWERS
TRUE OR FALSE
MULTIPLE CHOICE:
1. T
2. F 1. D
3. T 2. C
4. T 3. B
5. T 4. C
6. F 5. A
7. T 6. C
8. T 7. D
9. T 8. C
10. F 9. D
11. T 10. A
12. F
11. D
13. T
12. C
14. T
13. A
15. T
14. C
16. T
15. A
17. F
16. B
18. F
17. C
19. F
18. D
20. F
19. C
20. B