The Cost of Intangible Assets Should Be

question 22

Multiple Choice

The cost of intangible assets should be:

• A) amortized over the assets' estimated useful life, or its legal life, whichever is shorter.
• B) amortized over a period not exceeding 5 years.
• C) amortized over the assets' estimated useful life.
• D) charged to an expense account at acquisition.

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Definitions:

EPS

Earnings Per Share (EPS) is a financial metric that indicates the portion of a company's profit allocated to each outstanding share of common stock.

Operating Leverage Analysis

Examination of how fixed operating costs relate to profit levels, assessing the degree to which a firm can increase profits by increasing sales.

Breakeven Analysis

A technique for finding the volume at which a firm breaks even financially—that is, earns zero profit.

Volume

The quantity of an asset or security that is traded within a specified time period.