_____ Under purchase accounting, which of the following items is true?
A) Goodwill always exist.
B) Goodwill is charged to earnings at the acquisition date.
C) Goodwill is charged to stockholders' equity at the acquisition date.
D) Goodwill is capitalized-never to be amortized.
E) None of the above.

Question

Quizplus · Accepted Answer

Under purchase accounting, goodwill is capitalized and not amortized. Instead, it is subject to an annual impairment test to determine if its value has decreased.

_____ Under Purchase Accounting, Which of the Following Items Is