CAF-1 · Chapter 6 · Question 6 of 15
Beta Inc. acquires an intangible asset in exchange for a non-monetary asset. The transaction lacks commercial substance. How should the acquired intangible asset be initially measured?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) At the carrying amount of the asset given up.
Explanation
If an exchange transaction lacks commercial substance, the cost of the acquired intangible asset is measured at the carrying amount of the asset given up.
More IAS 38 Intangible Assets MCQs
- Q8Gamma Corp determines that a purchased broadcasting license has an indefinite useful life. How should this license be subsequently measured?
- Q9What is the assumed residual value of an intangible asset with a finite useful life, according to IAS 38?
- Q10If an entity reassesses an intangible asset's useful life from 'indefinite' to 'finite', how is this change treated?
- Q11Under SIC 32, when an entity develops a website for internal or external access, which costs can be capitalized as an intangible asset?
- Q12Which of the following costs should be included in the initial cost of a separately acquired intangible asset?