BUS 251 Lecture Notes - Lecture 8: Book Value, Impaired Asset, Software
14 May 2016
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Bus 251 ch8: long-term assets: purpose of lt assets: necessary to do business or to generate future revenues, types of lt assets, property, plant, equipment a. i. Cost model: the asset is reflected on statement of financial position using the carrying amount a. i. 1. a. Carrying amount: the original cost less accumulated amortization and accululated impairment losses. a. i. 1. c. Non-refundable taxes and import duties on the purchase price a. i. 1. c. iii. Site preparation, installation and set up costs a. i. 1. d. Capitalized: added to the cost of the asset a. i. 1. d. ii. Indifinite (not infinite): you can post impairment expense b. iii. Development costs may be capitalized under certain conditions. b. iii. 6. Patents: goodwill: when two businesses are combined, but it cannot be generated internally. c. i. Dr loss, cr gain: purchase of lt assets: part of investing activities, depreciation: in order to depreciate, you must know estimated residual value, estimated useful life, and depreciation amount, methods are ranked by popularity a. i. : value decreases by a percentage annually. a. ii. 1.
