In Order to Determine Whether or Not Expenditure Should Be

question 3

Multiple Choice

In order to determine whether or not expenditure should be treated as an intangible asset,the relevant test to apply is:

• A)It should be recognised when (a) it is definite that future economic benefits will eventuate or (b) the asset possesses a cost or other value that can be measured reliably.
• B)It should be recognised if (a) the expenditure is with an external party in an arm's length transaction for a separately identifiable intangible asset or (b) the intangible asset arises as the difference between the net tangible assets of an entity and the price paid for that entity.
• C)It should be recognised if (a) it is part of a specified plan by management to develop and maintain a separately identifiable asset or (b) the intangible asset was purchased in an arm's length transaction and is actively traded in a market.
• D)It should be recognised when and only when (a) it is probable that future economic benefits will eventuate and (b) the asset possesses a cost or other value that can be measured reliably.

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Definitions:

Glazier

A glassworker.

Cames

Thin metal strips, traditionally lead, used to join pieces of glass together in the creation of stained glass windows and art.

Optical Isolator Circuit

A component that uses light to transfer an electrical signal between two isolated circuits, preventing high voltages from affecting the system receiving the signal.

Line Voltage Transients

Short-duration surges, spikes, or dips in electrical power supply voltage, which can damage equipment or affect performance.