What is goodwill? Is goodwill amortized? What happens if the value of goodwill has decreased at the end of the year?

Q: How do you calculate Fixed Asset Turnover? What is the Free Cash Flow Ratio? What is the difference…

A: The answers for the questions on accounting ratios are discussed hereunder : Fixed Assets turn over…

Q: Which of the following statements is true regarding goodwill?

A: Goodwill: Goodwill is an intangible asset . This enables the firm to earn more than the other…

Q: How is the revaluation surplus handled under the revaluation model?

A: The question is related to Revaluation model under IAS16 Property, Plant and Equipment. Under this…

Q: Is long term investment is classified as non-current assets?

A: Generally, the liquidity of the assets plays a significant role in determining whether they are…

Q: What amount of net gain on biological asset should be reported in the current year?

A: Assets can be either fixed or the non-current asset which depends upon the duration and life of the…

Q: What are the Gain Taxes on Asset Disposals?

A: When a asset is disposed, if the value realised on such disposal is more than the carrying amount of…

Q: Explain what effect will an upward asset revaluation have on subsequent periods’ profits

A: The revaluation of assets means the change in the value of assets over a period of time this made…

Q: What are the Effects of Inflation on Projects with Depreciable Assets?

A: Answer: A depreciable asset is nothing a property that gives more economic benefit over a tax period…

Q: According to the historical cost principle, assets are measured at the exchange price at the time…

A: Introduction: As per the historical cost principle is one of basic accounting principle, is a…

Q: What is the current market view on USD/JPY? (Will it appreciate and which depreciate? and why?)

A: USD/JPY will be reflecting the exchange rate of Japanese currency with respect to 1 American dollar.…

Q: Which one of the following is not a method of valuation of goodwill? a. Super profit method b.…

A: Goodwill can be calculated by various methods suitable for various businesses considering various…

Q: True or false If you sell an asset for more than its salvage value you can record a loss for the…

A: Depreciation means the loss in value of assets because of usage of assets , passage of time or…

Q: On the June 1, combined balance sheet, how much is reported for goodwill?

A: On 01.06.20x9, CAP CO. paid = P800000 for net assets of SHER CO.  The balance sheet of the SHER CO.…

Q: When using the fair value method, we adjust the reported amount of the investment for changes in…

A: The sales price agreed by the buyer and seller is termed as Fair value assuming both parties are…

Q: What impact does goodwill have on the firm’sbalance sheet? On its income statement?

A: A type of intangible asset that defines the reputation and value of the firm in the market is known…

Q: If an entity capitalized transaction costs to a financial asset at fair value through profit or…

A: Transaction costs seem to be the costs spent while purchasing or selling a product or service.…

Q: Will some of the parties receive a preferred return? Will the preferred return be paid from annual…

A: The preferred return is a distribution of profit earned by the organization to their elite class of…

Q: What is the relationship between depreciation and net income?

A: Depreciation is the part of cost of a asset which is charged to income statement yearly as a expense…

Q: Assume that a company buys another business and pays for its goodwill. If the company plans to incur…

A: Goodwill is a intangible asset which is recorded during purchase of a entity by deducting market…

Q: What happens to the present value of some fixed dollar amount to be received in the future as time…

A: Present value of some fixed dollar amount  is obtained by discounting the future cash flows using an…

Q: How is the Salvage value a positive cash flow?

A: Cash flows are the cash generated from the operation of the business organisation. In other words,…

Q: Explain Depreciation Allowance under Inflation?

A: Inside these laws of unique cost depreciation, the absolute estimation of the duty exclusions in…

Q: What is the difference in the treatment of internally generated goodwill from the purchased goodwill…

A: The answer for the multiple choice question and relevant explanation are presented hereunder :

Q: The return on plan assets   a.is the change in the fair value of the plan assets during the year. b.…

A: Introduction: A long-term employee benefit fund's plan assets are assets/investments kept for the…

Q: As compared to capitalizing a cash expenditure, what is the initial effect on asset turnover of…

A: Asset Turnover = Sales / Average Total Assets Average Total Assets = (Beginning Total Assets +…

Q: What should be done to find the equivalent present worth of the actual dollar amount?

A: Present value is the concept of discounting future value to bring it to today’s worth.

Q: How should goodwill be amortized?

A: Goodwill is an example of intangible assets which has no physical identity.

Q: When a fixed asset is sold for less than book value, which one of the following will decrease?

A: Ratio Analysis: This refers to the performance measurement of the business, in order to know the…

Q: What should be the amount of Goodwill on December 31, 2020?

A: Shadow company acquired net assets of Recruit company on July 1, 2019 and recorded the value of…

Q: How much is the return on plan assets during the year?

A: Formula for Closing Balance of Plan Assets = Opening value of plan assets…

Q: What are the potential tax consequences of selling an old asset in an asset replacement investment…

A: Calculation of potential tax consequences of selling an old asset::: In the given case if the sale…

Q: goodwill at the acquisition date

A: The acquisition related costs should be written off as expenses in the books of the acquirer. They…

Q: How much is the adjustment in goodwill as a result of the measurement period adjustment during 2021?

A: The acquirer will adjust the amount of goodwill in the provisional amount in that reporting period…

Q: What is currency depreciation?

A: Currency depreciation is the depreciation in value of a currency in relation to supply and demand in…

Q: How much is the goodwill (gain on bargain ourchase)?

A: Calculation of Net Assets - Fair value: = Total Assets - Goodwill - Liabilities = P4,000,000 -…

Q: a. Over what period of time should the cost of a patent acquired by purchase be amortized?b. In…

A: Intangible Assets: These are the long-term assets having no physical existence. However, the…

Q: Formula of goodwill in acquisition date

A: Goodwill is the intangible asset of the organisation and it arises with the purchase of company by…

Q: Illustrate the significance of depreciation and income taxes?

A: Depreciation is the charge against the usage, wear and tear or obsolescence of the asset in the…

Q: 1. On December 31, 2019, what is the consolidated net income? 2. How much is the carrying value of…

A: William Corp has acquired 80% shares of Kate company and hence is the holding company of Kate…

Q: Under normal circumstances, will the carrying value of a long-term asset be equal to its market…

A: Assets are recorded at historical figures.

Q: cost of the new asset acquired

A: Cost of acquisition of new asset = Carrying amount of exchanged asset + Cash difference paid

Q: Which of the following properly describes the accounting for goodwill? Multiple Choice Goodwill is…

A: Goodwill is referred to as an intangible asset that helps in earning super-profits for the company.