9. Reporting and Analyzing Long-Lived Assets

Amortizable amount

The cost of a finite-life intangible asset less its residual value.

Amortization

The systematic allocation of the amortizable cost of a finite-life intangible asset over its legal or useful life.

Asset retirement costs

Amount added to the cost of a long-lived asset for dismantling, removal, or restoration obligations.

Asset turnover

Measure of how efficiently a company uses total assets to generate sales.

Capital expenditures

Expenditures benefiting future periods, recorded as long-lived assets.

Capital lease

Long-term agreement allowing one party to use an asset as a purchase.

Copyright

Exclusive right to reproduce and sell an artistic or published work.

Cost model

Accounting model carrying an asset at cost less accumulated depreciation or amortization.

Depletion

Depreciation of natural resources.

Depreciable amount

Cost of a depreciable asset less its residual value.

Development costs

Expenditures related to applying research to a new product or process.

Diminishing-balance method

Depreciation method with decreasing periodic expense.

Franchise

Contractual arrangement granting rights to sell products or services.

Impairment loss

Amount by which an asset's carrying amount exceeds its fair value.

Licenses

Operating right to use an asset granted by a government agency.

Operating expenditures

Expenditures benefiting only the current period, immediately expensed.

Operating lease

Lease arrangement accounted for as a rental.

Patent

Exclusive right to control an invention for 20 years.

Research expenses

Expenditures on original planned investigations expensed.

Residual value

Estimate of the amount obtained from an asset's disposal.

Return on assets

Measure of net income generated by each dollar invested in assets.

Revaluation model

Accounting model carrying an asset at fair value less accumulated depreciation.

Right-of-use asset

Leased asset recorded as property, plant, and equipment.

Straight-line method

Depreciation method dividing depreciable amount by useful life.

Trademark (trade name)

Word, phrase, symbol distinguishing a business or product.

Units-of-production method

Depreciation method based on total units of production or use.