This chapter covers the valuation at date of acquisition and the disposition of these assets. In Chapter 11 we discuss the allocation of the cost of operational assets to the periods benefited by their use, the treatment of expenditures made over the life of these assets to maintain and improve them, and the impairment of operational assets.
Identify the various costs included in the initial cost of property, plant, and equipment, natural resources, and intangible assets. |
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Determine the initial cost of individual operational assets acquired as a group for a lump-sum purchase price. |
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Determine the initial cost of an operational asset acquired in exchange for a deferred payment contract. |
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Determine the initial cost of operational assets acquired in exchange for equity securities or through donation. |
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Calculate the fixed-asset turnover ratio used by analysts to measure how effectively managers use property, plant, and equipment. |
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Explain how to account for dispositions and exchanges for other nonmonetary assets. |
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Identify the items included in the cost of a self-constructed asset and determine the amount of capitalized interest. |
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Explain the difference in the accounting treatment of costs incurred to purchase intangible assets versus the costs incurred to internally develop intangible assets. |