How many of the following statements regarding intangible assets are true?
Goodwill is an example of a self-created intangible asset and is measured by estimating the excess of fair value of the company's assets over their book value.
Goodwill is amortized using the straight-line method.
Intangible assets are not adjusted for asset impairment losses.
Only goodwill purchased from another company can be reported on the balance sheet as an intangible asset.
A) One
B) Two
C) Three
D) Four

Question

How many of the following statements regarding intangible assets are true?
 Goodwill is an example of a self-created intangible asset and is measured by estimating the excess of fair value of the company's assets over their book value.
 Goodwill is amortized using the straight-line method.
 Intangible assets are not adjusted for asset impairment losses.
Only goodwill purchased from another company can be reported on the balance sheet as an intangible asset.
A) One
B) Two
C) Three
D) Four

Quizplus · Accepted Answer

Only statement 1 is true. Goodwill is an example of an acquired intangible asset and is not self-created. It is measured by estimating the excess of the purchase price of a company over the fair value of its net assets. Goodwill is not amortized but tested for impairment at least annually. Intangible assets other than goodwill are also subject to impairment testing.

How Many of the Following Statements Regarding Intangible Assets Are