Identify the Incorrect Statement Regarding the Differences in the Treatment

question 99

Multiple Choice

Identify the incorrect statement regarding the differences in the treatment of goodwill across countries.

• A)When one company acquires another in a takeover,the value of the goodwill is calculated as the amount paid for a firm above its book value.
• B)Accounting rules in many countries allow acquiring firms to deduct the value of goodwill from the amount of equity or net worth reported on their balance sheet.
• C)Since 2001,the U.S.requires that goodwill associated with acquisitions has to be amortized against earnings.
• D)In the United States,until recently goodwill has had to be deducted from the profits of the acquiring firm over as much as 40 years.

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Definitions:

Mean

The arithmetic average of a set of numbers, calculated by summing them and dividing by the count of numbers.

Sample Range

The difference between the largest and smallest values in a sample, used as a measure of variability.

Outlier

A data point that differs significantly from other observations and can potentially skew results.

Measures Of Variability

Statistical values that describe the dispersion or spread in a dataset, such as range, variance, and standard deviation.