1. True or False: A loss should be recorded if a company's internally-developed goodwill is impaired during the current accounting period.
   1. True
   2. False

2. GAAP requires start-up costs to be:
   1. Capitalized and subsequently amortized over a 5-year useful life.
   2. Capitalized and subsequently amortized over a 10-year useful life.
   3. Capitalized but never amortized.
   4. Expensed in full in the period incurred.

3. True or False: Assuming a company has a patent on its books, the legal costs that relate to the successful defense of this patent should be expensed in full in the year incurred.
   1. True
   2. False

4. Which of the following is not a research and development activity?
   1. The testing of a new type of machine to evaluate its potential usefulness in a companys production process.
   2. The testing of alternative production methods in an attempt to significantly increase production in its factory facilities.
   3. The modification of a machine to make it suitable for fulfilling a customers special order.
   4. Laboratory research that focuses on the discovery of new knowledge.

5. What is the maximum number of years a private company with no public filing requirement may elect to amortize its goodwill over for financial reporting purposes?
   1. 5 years
   2. 8 years
   3. 40 years
   4. 15 years
   5. 20 years
   6. 10 years