_____ For a 60% ownership situation in which the parent paid an amount for goodwill, which of the following methods would report the highest amount for goodwill?

Question

Quizplus · Accepted Answer

The economic unit concept would report the highest amount for goodwill because it recognizes the full goodwill of the acquired company, not just the portion attributable to the parent's ownership interest. This approach calculates goodwill based on the entire fair value of the subsidiary, including both the controlling and non-controlling interests, leading to a higher reported goodwill compared to the parent company concept, which only recognizes goodwill attributable to the parent's share. Proportional consolidation is not typically used for calculating goodwill.

_____ for a 60% Ownership Situation in Which the Parent