According to IFRS 3, How Should Companies Account for Negative

question 4

Multiple Choice

According to IFRS 3, how should companies account for negative goodwill arising from business combinations?

• A)It should be capitalized and amortized over a period of no more than 40 years.
• B)It should be treated as a loss on the consolidated income statement.
• C)It should be recognized immediately as a gain in the income statement.
• D)There is no rule for negative goodwill, because there is no such thing.

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Definitions:

Socializing

The process by which people interact and communicate in society, helping establish norms and relationships.

Emotional Stability

The ability to remain calm and composed, especially in stressful situations, indicating resilience and psychological well-being.

Negotiation

The process of discussion aimed at reaching an agreement or compromise between two or more parties.

Indirectly Involved

Individuals or entities that are not directly engaged in an action but may be affected by its outcomes.