The Cost of an Intangible Asset

question 101

Multiple Choice

The cost of an intangible asset:

• A)should be immediately charged to expense if the cost was incurred to develop the intangible asset.
• B)should be immediately charged to expense whether the intangible asset was developed internally or purchased.
• C)should be recorded as an asset whose cost, like the cost of land, will not be allocated to expense.
• D)should be charged to expense over the life of the intangible asset.

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Definitions:

Clinton's Big Ditch

A colloquial term for the Erie Canal, significantly funded and championed by New York Governor DeWitt Clinton in the early 19th century, enhancing trade and westward expansion.

Erie Canal

A historic 363-mile waterway in New York that connects the Atlantic Ocean to the Great Lakes, greatly enhancing trade and transportation in the early 19th century.

Industrial Revolution

A period of major industrialization during the 18th and 19th centuries that transformed predominantly agrarian societies into industrialized and urban ones.

American Trade

Refers to the commerce and trade activities conducted by the United States with other countries, encompassing exports and imports of goods and services.