According to generally accepted accounting principles,the proper accounting treatment for the cost of a trademark that management feels will retain its value indefinitely is to
A)write the cost off immediately.
B)amortize the cost over a reasonable life.
C)amortize the cost over five years.
D)carry the cost as an asset as long as circumstances continue to support an indefinite life.

Question

Quizplus · Accepted Answer

According to generally accepted accounting principles, the proper accounting treatment for the cost of a trademark that management feels will retain its value indefinitely is to carry the cost as an asset as long as circumstances continue to support an indefinite life. This means that the cost should not be expensed immediately or allocated over a specific period of time, but rather recorded as an indefinite asset that will continue to provide value to the company. As long as the company continues to use and benefit from the trademark, it should remain as an asset on the balance sheet.

According to Generally Accepted Accounting Principles,the Proper Accounting Treatment for the Cost