In a Standard Audit Program for Goodwill Impairment Testing, If

question 126

Multiple Choice

In a standard audit program for goodwill impairment testing, if the original reporting unit no longer exists because operations have been fully integrated into operations of the parent company, which approach should the auditor take?

• A) Compare market value with carrying value. A market value less than carrying value is presumptive evidence that goodwill has been impaired.
• B) Compare fair value with realizable value. A fair value less than realizable value is presumptive evidence that goodwill has been impaired.
• C) Compare book value with realizable value. A book value less than realizable value is presumptive evidence that goodwill has been impaired.
• D) Compare book value with market value. A market value less than book value is presumptive evidence that goodwill has been impaired.

---

Definitions:

Psychophysiological

Pertains to the relationship between psychological processes and physiological responses, often explored through the study of how the mind affects the body's functions.

High Blood Pressure

A condition in which the force of the blood against the artery walls is too high, often leading to health problems.

Relaxation Training

Relaxation training refers to techniques and practices, such as deep breathing, progressive muscle relaxation, or meditation, aimed at reducing stress and promoting feelings of calm.

Lupus

A chronic autoimmune disease where the body's immune system becomes hyperactive and attacks normal, healthy tissue, leading to inflammation and tissue damage.