Mr and Mrs

question 104

Multiple Choice

Mr. and Mrs. Carleton founded Carleton Industries in 1993. This year, an independent appraiser placed a $25 million value on Carleton's business; $5 million of the value was attributable to unrecorded goodwill. Which of the following statements is true?

• A) Mr. and Mrs. Carleton are allowed to amortize the $5 million value of their business goodwill over 15 years.
• B) Mr. and Mrs. Carleton have a zero tax basis in their business goodwill.
• C) Mr. and Mrs. Carleton cannot amortize the $5 million value of their business goodwill because it is an intangible asset with an indeterminable life.
• D) None of these choices are true.

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Definitions:

Productivity

The efficiency at which goods or services are produced, typically measured by the output per unit of input.

Least Preferred Coworker

A measure used in Fiedler's contingency model to identify an individual's leadership style by assessing their feelings towards the least liked coworker.

Fiedler

Refers to Fiedler's contingency model of leadership, which suggests that the effectiveness of a leader depends on both the situation and their leadership style.

Scale

The size or level of something, often used in reference to the scope of a business operation or in measurement of phenomena.