Which statement about goodwill is true?
A) Goodwill can be purchased or sold as a separate item.
B) Goodwill arises from many factors, such as customer confidence, superior management and a favourable location.
C) Under IFRS 3/AASB 3 goodwill must be amortised.
D) Goodwill is classified as a current asset.

Question

Quizplus · Accepted Answer

Goodwill arises from many factors, such as customer confidence, superior management and a favourable location. This statement is true as goodwill is an intangible asset that represents the value of a company's reputation, relationships, and brand identity. It cannot be purchased, sold, or classified as a current asset. And under IFRS 3/AASB 3, goodwill is not amortised, but it is subject to annual impairment testing.

Which Statement About Goodwill Is True