When should a consolidated entity recognize a goodwill impairment loss? Multiple Choice If both the fair...
When should a consolidated entity recognize a goodwill impairment loss?
Multiple Choice
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If both the fair value of a reporting unit and its associated implied goodwill fall below their respective carrying amounts.
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Annually on a systematic and rational basis.
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If the fair value of a reporting unit with goodwill falls below its carrying amount.
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Whenever the entity’s fair value declines significantly.
Homework Answers
Recognition of Goodwill impairment loss by consolidated entity when
If both the fair value of a reporting unit and its associated goodwill fall below their respective carrying amounts. If the carrying amount of the cash-generating unit exceeds the related recoverable amount, the consolidated entity reports an Impairment loss.
So, option 'A' is correct.
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When should a consolidated entity recognize a goodwill
impairment loss?
Multiple Choice
If both the fair...
1. A company acquires a subsidiary and will prepare consolidated financial statements for extemal reporting purposes....
1. A company acquires a subsidiary and will prepare consolidated financial statements for extemal reporting purposes. For internal reporting purposes, the company has decided to apply the initial value method, Why might the company have made this decision? a. It is a relatively easy method to apply. 5. Operating results appearing on the parent's financial records rellect consolidated totals. c. GAAP now requires the use of this particular method for internal reporting purposes. d. Consolidation is not required when the...
While performing a goodwill impairment test, the company had the following information: Estimated implied fair value...
While performing a goodwill impairment test, the company had the following information: Estimated implied fair value of reporting unit $420,000 $400,000 Fair value of net assets on date of measurement (without goodwill) $380,000 Existing net book value of reporting unit (without goodwill) Book value of goodwill $ 60,000 Based upon this information the proper conclusion is: Select one: O a. The company should recognize a goodwill impairment loss of $40,000. O b. The company should recognize a goodwill impairment loss...
Alomar Co., a consolidated enterprise, conducted an impairment review for each of its reporting units. In...
Alomar Co., a consolidated enterprise, conducted an impairment
review for each of its reporting units. In its qualitative
assessment, one particular reporting unit, Sellers, emerged as a
candidate for possible goodwill impairment. Sellers had recognized
net assets with carrying amounts totaling $1,192, including
goodwill of $705. Seller’s reporting unit fair value is assessed at
$1,184 and includes two internally developed unrecognized
intangible assets (a patent and a customer list with fair values of
$272 and $112, respectively). The following table...
Alomar Co., a consolidated enterprise, conducted an impairment review for each of its reporting units. In...
Alomar Co., a consolidated enterprise, conducted an impairment review for each of its reporting units. In its qualitative assessment, one particular reporting unit, Sellers, emerged as a candidate for possible goodwill impairment. Sellers had recognized net assets with carrying amounts totaling $1,008, including goodwill of $600. Seller’s reporting unit fair value is assessed at $978 and includes two internally developed unrecognized intangible assets (a patent and a customer list with fair values of $132 and $142, respectively). The following table...
Determine the amount of goodwill that prover should report in its current financial statement. P1-33 Goodwill...
Determine the amount of goodwill that prover should report in
its current financial statement.
P1-33 Goodwill Assigned to Multiple Reporting Units The fair values of assets and liabilities held by three reporting units and other information related to the reporting units owned by Prover Company are as follows: Reporting Unit Cash & Receivables Inventory Land Buildings Equipment Accounts Payable Fair Value of Reporting Unit Carrying Value of Investment Goodwill Included in Carrying Value $ 30,000 60,000 20,000 100,000 140.000 40,000...
Please bold answers in explanation Alomar Co., a consolidated enterprise, conducted an impairment review for each...
Please bold answers in explanation
Alomar Co., a consolidated enterprise, conducted an impairment review for each of its reporting units. In its qualitative assessment, one particular reporting unit, Sellers, emerged as a candidate for possible goodwill impairment. Sellers had recognized net assets with carrying amounts totaling $1.266, including goodwill of $840. Seller's reporting unit fair value is assessed at $1,168 and includes two internally developed unrecognized intangible assets (a patent and a customer list with fair values of $244 and...
Alomar Co., a consolidated enterprise, conducted an impairment review for each of its reporting units. In...
Alomar Co., a consolidated enterprise, conducted an impairment review for each of its reporting units. In its qualitative assessment, one particular reporting unit, Sellers, emerged as a candidate for possible goodwill impairment. Sellers has recognized net assets of $1,087, including goodwill of $580. Seller’s fair value is assessed at $1,036 and includes two internally developed unrecognized intangible assets (a patent and a customer list with fair values of $242 and $108, respectively). The following table summarizes current financial information for...
Alomar Co., a consolidated enterprise, conducted an impairment review for each of its reporting units. In...
Alomar Co., a consolidated enterprise, conducted an impairment review for each of its reporting units. In its qualitative assessment, one particular reporting unit, Sellers, emerged as a candidate for possible goodwill impairment. Sellers has recognized net assets of $1,542, including goodwill of $935. Seller’s fair value is assessed at $1,392 and includes two internally developed unrecognized intangible assets (a patent and a customer list with fair values of $309 and $143, respectively). The following table summarizes current financial information for...
Alomar Co., a consolidated enterprise, conducted an impairment review for each of its reporting units. In...
Alomar Co., a consolidated enterprise, conducted an impairment review for each of its reporting units. In its qualitative assessment, one particular reporting unit, Sellers, emerged as a candidate for possible goodwill impairment. Sellers has recognized net assets of $1,366, including goodwill of $915. Seller’s fair value is assessed at $1,181 and includes two internally developed unrecognized intangible assets (a patent and a customer list with fair values of $222 and $115, respectively). The following table summarizes current financial information for...
Which of the following statements regarding goodwill is false? Select one: a. Goodwill is never amortized...
Which of the following statements regarding goodwill is false? Select one: a. Goodwill is never amortized for financial reporting purposes. O b. A company must review its goodwill for impairment annually O C. A company records goodwill at the time that it acquires another company or at the time it determines that material intellectual capital exists in its employees. Od. A company must review its goodwill for impairment whenever events or changes in circumstances occur that would more likely than...
1. A company acquires a subsidiary and will prepare consolidated financial statements for extemal reporting purposes. For internal reporting purposes, the company has decided to apply the initial value method, Why might the company have made this decision? a. It is a relatively easy method to apply. 5. Operating results appearing on the parent's financial records rellect consolidated totals. c. GAAP now requires the use of this particular method for internal reporting purposes. d. Consolidation is not required when the...
While performing a goodwill impairment test, the company had the following information: Estimated implied fair value of reporting unit $420,000 $400,000 Fair value of net assets on date of measurement (without goodwill) $380,000 Existing net book value of reporting unit (without goodwill) Book value of goodwill $ 60,000 Based upon this information the proper conclusion is: Select one: O a. The company should recognize a goodwill impairment loss of $40,000. O b. The company should recognize a goodwill impairment loss...
Alomar Co., a consolidated enterprise, conducted an impairment
review for each of its reporting units. In its qualitative
assessment, one particular reporting unit, Sellers, emerged as a
candidate for possible goodwill impairment. Sellers had recognized
net assets with carrying amounts totaling $1,192, including
goodwill of $705. Seller’s reporting unit fair value is assessed at
$1,184 and includes two internally developed unrecognized
intangible assets (a patent and a customer list with fair values of
$272 and $112, respectively). The following table...
Determine the amount of goodwill that prover should report in
its current financial statement.
P1-33 Goodwill Assigned to Multiple Reporting Units The fair values of assets and liabilities held by three reporting units and other information related to the reporting units owned by Prover Company are as follows: Reporting Unit Cash & Receivables Inventory Land Buildings Equipment Accounts Payable Fair Value of Reporting Unit Carrying Value of Investment Goodwill Included in Carrying Value $ 30,000 60,000 20,000 100,000 140.000 40,000...
Please bold answers in explanation
Alomar Co., a consolidated enterprise, conducted an impairment review for each of its reporting units. In its qualitative assessment, one particular reporting unit, Sellers, emerged as a candidate for possible goodwill impairment. Sellers had recognized net assets with carrying amounts totaling $1.266, including goodwill of $840. Seller's reporting unit fair value is assessed at $1,168 and includes two internally developed unrecognized intangible assets (a patent and a customer list with fair values of $244 and...
Which of the following statements regarding goodwill is false? Select one: a. Goodwill is never amortized for financial reporting purposes. O b. A company must review its goodwill for impairment annually O C. A company records goodwill at the time that it acquires another company or at the time it determines that material intellectual capital exists in its employees. Od. A company must review its goodwill for impairment whenever events or changes in circumstances occur that would more likely than...
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