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Chapter 6: Analysis of Long-Term Assets

Chapter 6: Analysis of Long-Term Assets (CFA Level 1): Key concepts, definitions, and exam tips with practical examples. Use it to reinforce intuition and avoid common pitfalls.

In this section

  • Capitalization of Costs vs. Immediate Expensing
    Capitalization of Costs vs. Immediate Expensing (CFA Level 1): Understanding the Fundamental Trade-Off, Key Criteria for Capitalizing Costs, and Immediate Expensing: The Short-Term Hit. Key definitions, formulas, and exam tips.
  • Depreciation, Amortization, and Asset Impairment
    Depreciation, Amortization, and Asset Impairment (CFA Level 1): Depreciation of Tangible Assets, Rationale Behind Depreciation, and Common Depreciation Methods. Key definitions, formulas, and exam tips.
  • Derecognition and Disposal of Long-Term Assets
    Derecognition and Disposal of Long-Term Assets (CFA Level 1): Fundamental Concepts, Key Terminology, and Derecognition Triggers. Key definitions, formulas, and exam tips.
  • Intangible Assets: Internally Developed vs. Acquired
    Intangible Assets: Internally Developed vs. Acquired (CFA Level 1): Recognition of Internally Developed Intangibles, IFRS Approach (IAS 38), and Criteria for Capitalization under IAS 38. Key definitions, formulas, and exam tips.
  • Revaluation vs. Cost Model
    Revaluation vs. Cost Model (CFA Level 1): Cost Model, Analytical Observations with the Cost Model, and Revaluation Model. Key definitions, formulas, and exam tips.
  • Component Depreciation and Partial Asset Retirements
    Component Depreciation and Partial Asset Retirements (CFA Level 1): IFRS Emphasis on Component Depreciation, Benefits of Component Depreciation, and US GAAP Perspective. Key definitions, formulas, and exam tips.
  • Exploration and Evaluation Assets in the Extractive Industry
    Exploration and Evaluation Assets in the Extractive Industry (CFA Level 1): IFRS 6 and the Extractive Industry, Full Cost Method, and Key Characteristics of the Full Cost Method. Key definitions, formulas, and exam tips.
  • Reclassification of Assets under Construction
    Reclassification of Assets under Construction (CFA Level 1): Test Your Knowledge: Reclassification of Assets under Construction and Which of the following best describes why reclassification. Key definitions, formulas, and exam tips.
  • Real Estate (REIT) Treatment of Long-Term Assets
    Real Estate (REIT) Treatment of Long-Term Assets (CFA Level 1): Nature of REIT Assets, Key Characteristics of REIT Structures, and Regulatory Considerations. Key definitions, formulas, and exam tips.

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Chapter 5: Analysis of Inventories
Chapter 7: Long-Term Liabilities and Equity