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Question -
1. When must interest be capitalized for a long-term asset? How does interest capitalization affect current and future year financial statements?
2. Compare straight-line, units-of-output, and double-declining balance methods of depreciation. How does each affect current and future year financial statements?
3. What types of intangible assets are amortized? (Provide the general rule and some specific examples.) How is amortization reported on the income statement and balance sheet?
4. What is impairment? How are impairments reflected on the financial statements? How is this consistent with the conceptual framework?
5. How does a company assess impairment of a tangible long-term asset? If a company believes that the asset is impaired, how is this reflected on the financial statements?
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