Chap020 (accounting) 67 - intangible asset and crediting...

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63. Cooper Inc. took physical inventory at the end of 2010. Purchases that were acquired FOB destination were in transit, so they were not included in the physical count. A. Cooper needs to correct an accounting error. B. Cooper has made a change in accounting principle, requiring retrospective adjustment. C. Cooper is required to adjust a change in accounting estimate prospectively. D. Cooper is not required to make any accounting adjustments. This inventory should be excluded because it had not yet reached its destination, where title passes. AACSB: Reflective thinking Bloom's: Synthesis Learning Objective: 20-06 Understand and apply the four-step process of correcting and reporting errors; regardless of the type of error or the timing of its discovery. Level of Learning: Medium 64. Washburn Co. spent $10 million to purchase a new patented technology, debiting an
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Unformatted text preview: intangible asset and crediting cash. Washburn uses SYD depreciation for its depreciable assets and plans to amortize the intangible asset on a straight-line basis. A. Washburn is not required to make any accounting adjustments. B. Washburn is required to adjust a change in accounting estimate prospectively. C. Washburn has made a change in accounting principle, requiring retrospective adjustment. D. Washburn needs to correct an accounting error. AACSB: Reflective thinking Bloom's: Evaluation Learning Objective: 20-06 Understand and apply the four-step process of correcting and reporting errors; regardless of the type of error or the timing of its discovery. Level of Learning: Medium...
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