Objectives: Chapter Eleven
The following learning objectives for this chapter map to the curriculum design for our online university-level courses. These courses are offered through Utah State University, and result in the awarding of up to 6 hours of highly transferrable college credit. To learn more, check out the classroom link.
The accounting for costs incurred subsequent to asset acquisition.
Define capital expenditure and revenue expenditure.
What three conditions help an item qualify as a capital expenditure?
Make a distinction between the accounting for a replacement and a betterment.
Appropriate methods to measure and record the disposal of PP&E.
Be able to record the removal of a depreciable asset from the accounts.
Know how to record the sale of a depreciable asset, including situations involving either a gain or loss.
Accounting for asset exchanges.
State the fundamental accounting rules relating to exchanges having commercial substance.
Know the general principles for asset exchanges that lack commercial substance.
Be able to prepare journal entries necessary to record asset exchange transactions.
Understand the meaning and general of effect of "boot" in an exchange transaction.
Rules for recording asset impairments.
Understand the fundamental accounting issues pertaining to asset impairments.
Natural resource accounting and depletion concepts.
What types of assets are considered to be natural resources?
Define the term "depletion."
Prepare depletion calculations and the related journal entries.
Distinguish between depletion that is charged to expense versus reported as an asset on the balance sheet.
Know how to account for depreciable assets used in conjunction with natural resource extraction.
Intangible asset accounting and amortization concepts.
What types of assets are considered to be intangible?
What is the difference between the accounting for an intangible with a determinable life versus an indefinite life?
Define the term "amortization."
Know how to calculate, record, and present amortization in the financial statements.
Be able to name several specific types of intangibles, and understand the how their lives would be assessed.