Which of the Following Is INCORRECT About the Measurement of Purchased

question 26

Multiple Choice

Which of the following is INCORRECT about the measurement of purchased intangible assets?

• A) Purchased intangible assets are measured at cost, which is their fair value at acquisition.
• B) Cost includes the acquisition cost and all expenditures necessary to make the intangible asset ready for its intended use.
• C) If an intangible asset is acquired due to a government grant, the asset is not recognized in the accounting records as there is no cost to the entity receiving the intangible asset.
• D) The cost of the intangible received in a nonmonetary exchange is the fair value of the consideration given or the fair value of the intangible received, whichever is more clearly evident.

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Definitions:

Compensation System

A structured plan designed by organizations to pay employees, which may include wages, salaries, bonuses, and benefits.

Telecommuting

A work arrangement in which employees do not commute to a central place of work, often working from home or a location close to home.

Employee Owners

Individuals who hold ownership stakes in the company they work for, often through stock options or an employee stock ownership plan (ESOP).

Job Enlargement

The process of increasing the number and variety of tasks that an employee performs, aiming to add more diversity and interest to the job.