Which of the following statements is true about goodwill? The intangible asset goodwill may be written off directly to O a. retained earnings. O b. The intangible asset goodwill may be capitalized either when purchased or created internally. O c. The intangible asset goodwill may be capitalized only when created internally. O d. The intangible asset goodwill may be capitalized only when purchased.

Which of the following statements is true about goodwill? The intangible asset goodwill may be written off directly to O a. retained earnings. O b. The intangible asset goodwill may be capitalized either when purchased or created internally. O c. The intangible asset goodwill may be capitalized only when created internally. O d. The intangible asset goodwill may be capitalized only when purchased.

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter12: Auditing Long-lived Assets And Merger And Acquisition Activity

Section: Chapter Questions

Problem 33CYBK

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Which statement regarding goodwill is true? a. goodwill is an unidentifiable intangible assetb. internally developed goodwill should be capitalized while purchased goodwill should beexpensedc. goodwill can be defined as the value attached to the ability of a company to earn a higherthan normal rate of return on the book value of its identifiable assetsd. in some situations, FASB Statement No. 141 requires that negative goodwill be recorded
Which one of the following category goodwill lies? a. Fictitious asset b. Intangible asset c. Non-current asset d. Current asset
Which one of the following is not a method of valuation of goodwill? a. Super profit method b. Average profit method c. Revaluation method d. Capitalization method
2-Which one of the following category goodwill lies? a. Intangible asset b. Fictitious asset c. Non-current asset d. Current asset
During the measurement period, which of the following may affect the amount of goodwill from business combination? New information regarding estimates in the contingent consideration that are not existing at the date of acquisition Nothing can affect the amount of goodwill. New information regarding estimates in the contingent consideration that are existing at the date of acquisition. New information regarding estimates in the contingent consideration
The impairment test for goodwill is conducted based on the cash-generating unit to which the goodwill has been assigned. After an impairment loss is recorded for goodwill, the recoverable amount becomes the basis for the impaired asset and is used to calculate amortization in future periods. options : both statement false first statement true and second statement false fisrt statement false and second statement ttrue . both sttament true
Which of the following statements regarding IFRS accounting for goodwill is/are incorrect: (i) Negative goodwill is reported as a liability (ii) A goodwill impairment expense decreases the carrying amount of goodwill on the consolidated SoFP (iii) The calculation of goodwill at acquisition date must include the fair value of non-controlling interests in the acquiree
In a business combination, goodwill is defined as the excess of acquisition cost over the a. fair value of assets acquired. b. fair value of assets acquired less the liabilities assumed. c. net book value of assets acquired. d. book value of assets acquired less the liabilities assumed.
The reason goodwill is sometimes referred to as a master valuation account is because a. it represents the purchase price of a business that is about to be sold.b. it is the difference between the fair market value of the net tangible and identifiableintangible assets as compared with the purchase price of the acquired business.c. the value of a business is computed without consideration of goodwill and thengoodwill is added to arrive at a master valuation.d. it is the only account in the financial statements that is based on value, all otheraccounts are recorded at an amount other than their value.
How is the goodwill impairment calculated? I thought it was by adding assets and subtracting the accounts payable for net assets. Then adding goodwill and subtracting the fair value
Indicate whether each of the following statements is true or false. Goodwill can only arise from a third-party purchase of another company’s net assets. Under IFRS, indefinite-life intangibles are treated the same way as definite-life intangibles regarding impairment evaluation but not measurement. Under IFRS, goodwill impairment reversals are not allowed unless the goodwill is internally developed.
Th e initial measurement of goodwill is most likely aff ected by: B . the acquired company’s book value.