Question

Given the following list, indicate if each entry normally is an item related to the ongoing core business of a company. Enter “Yes” if it normally relates to the ongoing core business and “No” of it does not.

A) Litigation-related charges:

B) Royalty expense:

C) Impairment of goodwill:

D) Restructuring charges:

E) SG&A expense:

F) R&D expense:

G) Gains and losses on the sale of assets:

H) Amortization of acquired intangibles:

I) Purchased R&D expense:

J) Asset write-offs:

Answer 1

A) Litigation-related charges: No , as legal actions are taken place only when there are certain issues, not regular

B) Royalty expense: yes, if the company is paying expenses as a part of agreement.

C) Impairment of goodwill: no, as this occurs at the time the company acquires an asset, and it is not a operational activity

D) Restructuring charges: no, as this is not an on-going activity

E) SG&A expense: yes, it occurs on daily basis

F) R&D expense: yes, it occurs on daily basis

G) Gains and losses on the sale of assets: no, only at the time of sale of asset, which is not the core of the business

H) Amortization of acquired intangibles: no, this expenses is deducted throughout the life of the asset and not directly related to day to day working

I) Purchased R&D expense: Yes, this activity is required for the core working of business

J) Asset write-offs: No, this is not a activity directly related to operations.