taxi license, including P10,000 refundableJune 30 Legal cost directly attributable to the acquisitiona taxi business in a local city during the current year:The taxi drivers own the vehicles which they operate underThe economic life of the taxi license is 5 years from the dateAn SME incurred the following expenditures in establiahingProblem 27-4 (IFRS).Problem271. An entityMay 1 General start-up costof the taxi license15,0008. The amob. The ama30,000receivac. The faa. NIL.100,0002. An SMEnot imp10,000purchase taxes50,000a. Inb. Inlocal daily newspaperс.d.3. AinSME's taxi license.1. What is the initial cost of the intangible asset?a. 120,000b. 130,000c. 135,000d. 145,0002. What is the amortization of the intangible asset for thecurrent year?a. 24,000b. 12,000c. 26,000d. 13,0003. What total amount of expenses should be recognized torthe current year?a. 87,000b. 97,000c. 62,000d. 74,000FINANCACCOUNT

Amortization is a method under which the book value of the intangible assets or the loan is reduced…

Problem 27-4 (IFRS) establishing a taxi business in a local city during the current year. Legal cost directly attributable to the acquisition Payment to the taxi licensing authority for the Problem 27 An SME incurred the following expenditures in c 1. An enti 15,000 a. Th b. T 1 General start-up cost May June 30 30.000 of the taxi license To C. taxi license, including P10,000 refundable d. purchase taxes Printing business cards of the drivers Payment for an advertisement to be published June 30 100,000 10,000 2. An July 1 July 1 monthly for the next 12 monthe in a local daily newspaper no 50,000 a The economic life of the taxi license is 5 years from the date of acquisition on June 30 with NIL residual value. The taxi drivers own the vehicles which they operate under SME's taxi license. 1. What is the initial cost of the intangible asset? a. 120,000 b. 130,000 c. 135,000 d. 145,000 2. What is the amortization of the intangible asset for the current year? a. 24,000 b. 12,000 c. 26,000 d. 13,000 3. What total amount of expenses should be recognized for the current year? a. 87,000 b. 97,000 C. 62,000 d. 74,000

Problem 27-4 (IFRS) establishing a taxi business in a local city during the current year. Legal cost directly attributable to the acquisition Payment to the taxi licensing authority for the Problem 27 An SME incurred the following expenditures in c 1. An enti 15,000 a. Th b. T 1 General start-up cost May June 30 30.000 of the taxi license To C. taxi license, including P10,000 refundable d. purchase taxes Printing business cards of the drivers Payment for an advertisement to be published June 30 100,000 10,000 2. An July 1 July 1 monthly for the next 12 monthe in a local daily newspaper no 50,000 a The economic life of the taxi license is 5 years from the date of acquisition on June 30 with NIL residual value. The taxi drivers own the vehicles which they operate under SME's taxi license. 1. What is the initial cost of the intangible asset? a. 120,000 b. 130,000 c. 135,000 d. 145,000 2. What is the amortization of the intangible asset for the current year? a. 24,000 b. 12,000 c. 26,000 d. 13,000 3. What total amount of expenses should be recognized for the current year? a. 87,000 b. 97,000 C. 62,000 d. 74,000

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter7: Operating Assets

Section: Chapter Questions

Problem 64E

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