Mastering Joint Ventures

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Which of the following is an example of an intangible asset?

Patent rights (correct)

Inventory

Buildings

Machinery

According to IAS 38, which of the following is not considered an intangible asset?

Financial assets

Goodwill

Deferred tax assets

Inventory (correct)

When is an intangible asset considered identifiable?

When it has physical substance

When it is separable (correct)

When it arises from contractual or other legal rights

When it is recorded as a single tangible asset

Which one of the following is a requirement for recognizing an intangible asset?

The cost of the item can be measured reliably Signup and view all the answers

Which accounting model is commonly used to evaluate intangible assets?

Cost model Signup and view all the answers

Under the revaluation model, what is not allowed?

Recognizing the asset at a value greater than its cost Signup and view all the answers

When can research and development costs be recorded as intangible assets?

When they become development costs Signup and view all the answers

Which type of investment is represented through fixed assets in a company's balance sheet?

Subsidiaries Signup and view all the answers

According to IFRS 10, control over a company is obtained when the investor is able to influence its business through what means?

All of the above Signup and view all the answers

How is an investment in a subsidiary evaluated under IFRS 9?

At cost Signup and view all the answers

What is the criteria for an investment to be considered an associate?

The investor has significant influence over the investee Signup and view all the answers

According to IAS 38, when can an intangible asset be recognized in the balance sheet?

When it has the power to obtain future economic benefits Signup and view all the answers

What are the future economic benefits that an intangible asset can provide according to IAS 38?

All of the above Signup and view all the answers

According to IAS 38, where should the costs related to research be recorded?

In the profit and loss statement Signup and view all the answers

According to IAS 38, what conditions must be demonstrated for an intangible asset arising from the development phase of an internal project to be recognized?

Technical feasibility, intention to complete, ability to use or sell, future economic benefits, and availability of resources Signup and view all the answers

According to IAS 38, how should intangible assets be reported in the balance sheet?

At their cost less any accumulated depreciation and any accumulated impairment losses Signup and view all the answers

What is the value in use of an asset?

The net present value of cash flow or other benefits generated by an asset to a specific owner and under a specific use Signup and view all the answers

How is impairment of intangible assets determined?

By comparing the value in use and net selling price to the carrying amount Signup and view all the answers

When should the carrying amount of an intangible asset be derecognized?

On disposal or when no future economic benefits are expected from its use or disposal Signup and view all the answers

Which one of these is true about goodwill?

Goodwill is initially measured as the difference between the price paid and the value of net assets Signup and view all the answers

What is the purpose of impairment testing for goodwill?

To verify the recoverability of goodwill at each subsequent closing date Signup and view all the answers

How is goodwill initially measured?

As the difference between the price paid and the value of net assets Signup and view all the answers

What is a cash-generating unit (CGU)?

An identifiable group of assets within a company Signup and view all the answers

According to IAS 36, how should a company determine if an intangible asset with indefinite useful life has maintained its value?

By comparing its carrying amount with its recoverable amount Signup and view all the answers

When should the loss of fair value be booked in the profit and loss?

Unless the loss is subsequent to a previous revaluation accounted to the equity Signup and view all the answers

How should the depreciation of intangible assets with defined useful life be recorded?

Using the same rule as tangible assets, i.e. depreciating them regularly Signup and view all the answers

When does the depreciation of an asset begin?

When it is available for use and in the location and condition necessary for it to operate as intended Signup and view all the answers

What is the recommended approach for estimating the free cash flow of an asset beyond a certain period?

Approximate the free cash flow based on a defined growth rate and then discount it by WACC Signup and view all the answers

What is the difference between IFRS and OIC with reference to investments, according to the text?

OIC requires impairment testing while IFRS does not Signup and view all the answers

What loss amount is reported by the company in the impairment test, according to the text?

Euro 12.050 Signup and view all the answers

Which type of joint arrangement requires unanimous consent for decisions about relevant activities?

Joint venture Signup and view all the answers

Under IFRS 9, how are investments recognized?

At fair value Signup and view all the answers

When can changes in value of investments be classified within the OCI under IFRS 9?

When the aim is to sell the investments Signup and view all the answers

What is the purpose of the terminal value in cash flow calculations?

To express the value of the company beyond the explicit period of the plan Signup and view all the answers