The New IASB Standard Issued with Respect to the Treatment

question 1

Multiple Choice

The new IASB standard issued with respect to the treatment of negative goodwill requires that:

• A) it must be recognized in income immediately as an extraordinary item.
• B) it must be recognized in income immediately.
• C) it can be deferred and amortized over a maximum of 40 years.
• D) it must be reflected as an increase in Liabilities and a Reduction in Capital for the Parent Company.

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Definitions:

Antibiotics

Medicinal substances used to kill or inhibit the growth of bacteria to treat and prevent bacterial infections.

Emulsification

The process of breaking up and evenly dispersing fat or oil in a liquid to form a stable mixture, such as in making mayonnaise or vinaigrettes.

Peristalsis

The series of wave-like muscle contractions that moves food through the digestive tract.

Hydrolysis

Hydrolysis is a chemical reaction in which water is used to break down the bonds of a compound, often splitting molecules into two or more smaller substances.