Which of the following statements is false?
A) Goodwill arises when one company acquires another company for a price in excess of the fair market value of the net identifiable assets acquired.
B) Goodwill should be depreciated.
C) Goodwill must be evaluated annually to determine if there has been a loss of value.
D) If the carrying value of goodwill exceeds the fair value, the excess book value must be written off as an impairment expense.

Question

Quizplus · Accepted Answer

Goodwill should not be depreciated as it is an intangible asset with an indefinite useful life. Instead, it should be evaluated for impairment annually to determine if there has been a loss of value.

Which of the Following Statements Is False