Company A buys Company B for $3,500,000. Company A had a pre-merger net worth of $8,000,000; Company B's net worth was $2,000,000. The transaction was accounted for as a pooling of interests. Company A wants to write off any available goodwill as slowly as allowable.
-Over how many years can goodwill be written off for accounting purposes?
A) 0 years
B) 20 years
C) 40 years
D) 50 years

Question

Quizplus · Accepted Answer

In a pooling of interests, no goodwill is recognized, so there is no goodwill to write off.

Company a Buys Company B for $3,500,000