F7 (FR) – Chapter 4 – PART B – CBE MCQs – ACCA

These are ACCA F7 (FR) Financial Reporting MCQs for Part-B of the Syllabus “Accounting for transactions in financial statements”.

These multiple-choice questions (MCQs) are designed to help ACCA F7 students to better understand the exam format. We aim to instill in students the habit of practicing online for their CBE exams. By doing so, students can reduce exam stress and prepare more effectively.

Please note:

  • Students should not attempt these MCQs until they have finished the entire chapter.
  • All questions are compulsory, so please do not skip any.

We hope that these MCQs will be a valuable resource for students preparing for the ACCA F7 (FR) exam.


Course:ACCA – Association of Chartered Certified Accountants
Fundamental Level:Applied Skills
Subject:Financial Reporting
Paper:F7 – FR
Chapter and Topic04 – Intangible non-current assets
Syllabus Area:B – “Accounting for transactions in financial statements”
Questions Type:CBE MCQs
Exam Section:Section A

Syllabus Area

These Multiple Choice Questions (MCQs) cover the Syllabus Area Part-B of the Syllabus; “Accounting for transactions in financial statements” of ACCA F7 (FR) Financial Reporting Module.


These MCQs are not time-bound. Take your time and solve them without stress. Pay proper attention and focus. Do not rush or hesitate


Students will get their F7 CBE MCQs Test results after they finish the entire test. They will also be able to see the correct and incorrect answers, as well as explanations for the incorrect questions.

Types of Questions

MCQs: Choose one from the given options.
Multiple choice: Choose all those answers which seem correct/ or incorrect to you, as per the requirement of the question. Keep your eye on the wording “(select all those which are correct/ or incorrect)“.
Drop-down: Select from the list provided.
Type numbers: Type your answer in numbers as per the requirement of the question.

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F7 (FR) - Chapter 04 - Part B - MCQs - Intangible non-current assets 

Course: ACCA - Association of Chartered Certified Accountants
F7 (FR) - Financial Reporting
Syllabus Area: B - Accounting for transactions in financial statements
Chapter: 04 - Intangible non-current assets
Exam Section: Section A
Questions type: MCQs
Time: No Time Limit


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1 / 5

Geek Co is developing a new product and expects to be able to capitalise the costs. Which of the following would disallow the capitalisation of the costs?

2 / 5

At 30 September 20X9 Sandown Co's trial balance showed a brand at cost of $30 million, less accumulated amortisation brought forward at 1 October 20X8 of $9 million. Amortisation is based on a ten year useful life. An impairment review on 1 April 20X9 concluded that the brand had a value in use of $12 million and a remaining useful life of three years. However, on the same date Sandown Co received an offer to purchase the brand for $15 million.

What should be the carrying amount of the brand in the statement of financial position of Sandown Co as at 30 September 20X9? (Answer to the nearest $'000)

Note. You are not required to put $ sign nor any coma. (e.g. 1000)

3 / 5

Assoria Co had $20 million of capitalised development expenditure at cost brought forward at 1 October 20X7 in respect of products currently in production and a new project began on the same date.

The research stage of the new project lasted until 31 December 20X7 and incurred $1.4 million of costs.
From that date the project incurred development costs of $800,000 per month. On 1 April 20X8 the directors of Assoria Co became confident that the project would be successful and yield a profit well in excess of costs. The project was still in development at 30 September 20X8. Capitalised development expenditure is amortised at 20% per annum using the straight-line method.

What amount will be charged to profit or loss for the year ended 30 September 20X8 in respect of research and development costs?

4 / 5

Which of the following internally generated items are eligible or ineligible for capitalisation as intangible assets in accordance with IAS 38 Intangible Assets? (Ignore business combinations.)

  1. A customer list built up over the last ten years of trading updated for the customer's current preferences
  2. Specialised tooling for a new product developed by the business.
  3. A working version of a new machine that uses new technology used for testing of the prototype apparatus.
  4. The title heading, font and design of the front page of a major broadsheet newspaper

5 / 5

Dempsey Co's year end is 30 September 20X5. Dempsey Co commenced the development stage of a project to produce a new pharmaceutical drug on 1 January 20X5. Expenditure of $40,000 per month was incurred until the project was completed on 30 June 20X5 when the drug went into immediate production. The directors became confident of the project's success on 1 March 20X5. The drug is expected to generate benefits for five years.

What is the carrying amount of any intangible asset recognised in respect of the project and what is the total amount Dempsey Co will charge to profit or loss for the year ended 30 September 20X5?

Following are the Options:

Option Carrying amount of intangible asset at 30 September 20X5 Amount charged to profit or loss for period ending 30 September 20X5
(A) $228,000 $240,000
(B) $152,000 $88,000
(C) $98,667 $141,333
(D) $0 $0

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