Which of the Following Statements Is Incorrect

question 23

Multiple Choice

Which of the following statements is incorrect?

• A) Goodwill cannot be revalued.
• B) Goodwill is subject to amortisation.
• C) Goodwill is not subject to amortisation.
• D) AASB 138/IAS 38 Intangible Assets does not allow the recognition of internally generated goodwill.

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Definitions:

Fair Value Adjustment-Trading

The process of adjusting the valuation of trading securities to reflect their current market value.

Adjusting Journal Entry

A journal entry made in the accounting records at the end of an accounting period to allocate income and expenditure to the correct period.

Stock Investments

Stock investments refer to the purchasing of shares in companies as a means of owning a portion of the company and potentially earning dividends or capital gains.

Journal Entries

The recordings of financial transactions in an accounting system which form the basis of building financial statements.