Which of the following statements regarding book-tax differences associated with purchased goodwill is false?
A) In a year when goodwill is impaired and yet fully amortized for tax purposes (so no tax amortization of the goodwill for that year) , the book-tax difference will be unfavorable.
B) Temporary book-tax differences associated with goodwill are always favorable.
C) If goodwill has been fully amortized for tax purposes in a previous year, the book-tax difference is equal to the amount of impairment recognized.
D) It is possible to have no book-tax difference in a year when there is no goodwill amortization for tax purposes.
Correct Answer:
Verified
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