10 Lecture

1. Which of the following is an example of other non-current assets? A) Land held for investment purposes B) Machinery and equipment C) Goodwill D) Short-term investments

Answer: A) Land held for investment purposes

2. How are other non-current assets reported on the balance sheet? A) Under the current assets section B) Under the liabilities section C) Under the non-current assets section D) Under the equity section

Answer: C) Under the non-current assets section

3. Which of the following is an example of long-term prepaid expenses? A) Insurance premiums paid for the next six months B) Rent paid for the next month C) Advertising expenses paid for the next year D) Salaries paid for the current month

Answer: C) Advertising expenses paid for the next year

4. What are deferred tax assets? A) Assets that are recorded at a higher value than their fair market value B) Assets that arise due to temporary differences between accounting and tax rules C) Assets that are used in the production of goods and services D) Assets that are purchased for investment purposes

Answer: B) Assets that arise due to temporary differences between accounting and tax rules

5. Which of the following is an example of long-term receivables? A) Amounts owed by customers for goods or services sold on credit B) Amounts owed by suppliers for goods or services purchased on credit C) Amounts owed by employees for advances or loans D) Amounts owed by the government for taxes paid in excess

Answer: A) Amounts owed by customers for goods or services sold on credit

6. How are other non-current assets typically amortized? A) Straight-line method B) Double-declining balance method C) Sum-of-the-years'-digits method D) They are not typically amortized

Answer: D) They are not typically amortized

7. How often are other non-current assets tested for impairment? A) Monthly B) Quarterly C) Annually D) It depends on the nature of the asset

Answer: D) It depends on the nature of the asset

8. Which of the following is an example of an intangible other non-current asset? A) Long-term investments in marketable securities B) Prepaid expenses for a period exceeding one year C) Trademarks and patents D) Inventories held for more than one year

Answer: C) Trademarks and patents

9. What is the purpose of accounting for other non-current assets? A) To increase net income B) To decrease taxes owed C) To provide accurate financial reporting D) To reduce liabilities

Answer: C) To provide accurate financial reporting

10. How are other non-current assets typically valued? A) At cost less accumulated depreciation B) At fair value less accumulated depreciation C) At market value less accumulated depreciation D) At replacement cost less accumulated depreciation

Answer: B) At fair value less accumulated depreciation

1. What are other non-current assets? Answer: Other non-current assets are long-term assets that are not classified as property, plant, and equipment, intangible assets, or investments in associates.

2. What are long-term prepaid expenses? Answer: Long-term prepaid expenses are expenses that have been paid in advance and are expected to provide future economic benefits beyond one year.

3. How are deferred tax assets created? Answer: Deferred tax assets are created due to temporary differences between accounting and tax rules, which result in lower taxes paid in the current year and higher taxes paid in future years.

4. What is an impairment test? Answer: An impairment test is a test performed on assets to determine if their carrying value exceeds their recoverable amount. If so, the asset is considered impaired and the carrying value is reduced accordingly.

5. How are intangible other non-current assets amortized? Answer: Intangible other non-current assets, such as patents and trademarks, are typically amortized over their useful lives.

6. What is the difference between long-term receivables and short-term receivables? Answer: Long-term receivables are amounts owed by customers that will be collected beyond one year, while short-term receivables are amounts owed by customers that will be collected within one year.

7. What is the purpose of testing other non-current assets for impairment? Answer: The purpose of testing other non-current assets for impairment is to ensure that they are carried at no more than their recoverable amount.

8. How are other non-current assets reported on the balance sheet? Answer: Other non-current assets are reported on the balance sheet under the non-current assets section.

9. What is the role of other non-current assets in financial reporting? Answer: Other non-current assets play an important role in financial reporting as they provide information about a company's long-term investments and commitments.

10. What are some examples of other non-current assets? Answer: Examples of other non-current assets include long-term prepaid expenses, deferred tax assets, long-term receivables, and investments in non-consolidated subsidiaries.

Other non-current assets refer to long-term assets that do not fit into any other category such as property, plant, and equipment, intangible assets, or investments in associates. These assets represent a company's long-term investments and commitments, which are expected to generate future economic benefits beyond one year. Examples of other non-current assets include long-term prepaid expenses, deferred tax assets, long-term receivables, investments in non-consolidated subsidiaries, and long-term deposits. Long-term prepaid expenses are expenses that have been paid in advance and are expected to provide future economic benefits beyond one year. Deferred tax assets arise from temporary differences between accounting and tax rules, resulting in lower taxes paid in the current year and higher taxes paid in future years. Long-term receivables are amounts owed by customers that will be collected beyond one year, while investments in non-consolidated subsidiaries are long-term investments in other companies in which the investor has significant influence but not control. Long-term deposits are cash deposits that are not intended to be used for current operations, but rather held for future use. Other non-current assets are reported on the balance sheet under the non-current assets section. They are subject to periodic impairment tests to ensure that their carrying value does not exceed their recoverable amount. If an asset is impaired, its carrying value is reduced accordingly. In summary, other non-current assets represent a company's long-term investments and commitments that are expected to generate future economic benefits beyond one year. They play an important role in financial reporting as they provide information about a company's long-term financial health and potential for future growth.