What amount should the company report for inventory on its balance sheet? a. $35,000. b. $40,000. c. $45,000. d. $48,000. An asset is considered to be impaired when it's carrying amount is greater than its a. Net selling price. b. Value in use. c. Undiscounted future cash flows. d. Recoverable amount. Which of the following is a criterion that must be met in order for an item to be recognized as an intangible asset? a. The item's fair value can be measured reliably. b. The item is part of the entity's activities aimed at gaining scientific or technical knowledge. c. The item is expected to be used in the production or supply of goods or services. d. The item is identifiable and lacks physical substance. Which of the following types of transaction is most likely to be audited? a. Sales of tangible property. b. Licenses of intangible property. c. Intercompany loans. d. Intercompany services. The IRS has the authority to impose penalties on companies that significantly underpay taxes as a result of inappropriate transfer pricing. Acme Company transfers a product to a foreign affiliate at $15 per unit, and the IRS determines the correct price should have been $65 per unit. The adjustment results in an increase in U.S. tax liability of $1,250,000. Due to this change in price, "what amount of penalty for underpayment of taxes as a result of an inappropriate transfer price will Acme Company pay?" a. $0 b. $125,000 c. $250,000 d. $500.000