Accounting Ch 10 Plant Assets,Natural Resources, and Intangible Assets
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kleiner2299 on May 3, 2011
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26 terms
Terms | Definitions |
|---|---|
 Accelerated-depreciation method | Depreciation method that produces higher depreciation expense in the early years rather than in the later years |
| Additions and improvements | Costs incurred to increase the operating efficiency, productive efficiency, or useful life of a plant asset |
| Amortization | The allocation of the cost of an intangible asset to expense over its useful life in a systematic and rational matter |
| Asset turnover ratio | A measure of how efficienly a company uses its assets to generate sales; calculated as net sales divided by average total assets |
| Capital expenditures | Expenditures that increase a company's investment in productive facilities. |
| Copyright | Exclusive grant from the federal government that allows the owner to reproduce and sell an artistic or published work |
| Declining-balance method | Depreciation method that applies a constant rate to the declining book value of the asset and produces a decreasing annual depreciation expense over the useful life of the asset |
| Depletion | The allocation of the cost of a natural resource to expense over its useful life in a rational and systematic manner |
| Depreciable cost | The cost of a plant asset minus salvage value |
| Franchise | A contractual arrangement under which the franchisor grants the franshisee the right to sell certain products, provide specific services, or use certain trademarks or trade names, usually within a designated geographic area. |
| Going-concern assumption | States that the company will continue in operation for the forseeable future |
| Goodwill | The value of all favorable attributes that relate to a business enterprise. |
| Intangible asset | Rights, priviliages, and competitive advantages that result from the ownership of long-lived assets that do not possess physical substance |
| Licenses | Operating rights to use public property, granted to a business enterprise by a governmental agency. |
| Materiality Priciple | If an item would not make a difference in decision making, a company does not have to follow GAAP in reporting it. |
| Natural Resources | Assets that consist of standing timber and underground deposits of oil,gas, or minerals |
| Ordinary repairs | Expenditures to maintain the operating efficiency and productive life of a unit. |
| Patent | An exclusive right issued by the U.S Patent Office that enables the recipient to manufacture, sell, or otherwise control an invention for a period of 20 years from the date of the grant. |
| Plant assets | Tangible resources that are used in the operations of the business and are not intended for sale to customers. |
| R and D Costs | Expenditures that may lead to patents, copyrights, new processes, or a new products. |
| Revenue expenditures | Expenditures that are immedietely charged against revenues as an expense. |
| Salvage value | An estimate of an asset's value at the end of its useful life |
| Straight-line method | Depreciation method in which periodic depreciation is the same for each year og the asset's useful life. |
| trademark | A word,phrase,jingle, or symbol that identifies a particular enterprise or product. |
| Units-of-activity method | Depreciation method in which useful life is expressed in terms of the total units of production or use expected from an asset |
| Useful life | An estimate of the expected productive life, also called service life, of an asset |
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