In testing goodwill for impairment,the audit team will evaluate management's
A)estimated allowance for goodwill losses as a percent of sales.
B)ability to utilize the purchase method of accounting.
C)assessment of the initial purchase price of the acquired company in relation to its assets.
D)methodologies for assessing impairment.

Question

Quizplus · Accepted Answer

In testing goodwill for impairment, the audit team will evaluate management's methodologies for determining and assessing goodwill impairment. These methodologies may include estimating fair value, assessing the carrying value of assets and liabilities, and evaluating current and future economic conditions. While the other options may be relevant to accounting for goodwill, they are not directly related to testing goodwill for impairment.

In Testing Goodwill for Impairment,the Audit Team Will Evaluate Management's