If C Contributes $40,000 to the Partnership and the Goodwill

question 46

Multiple Choice

If C contributes $40,000 to the partnership and the goodwill method is used, what amount will be debited for goodwill?

• A) $15,000
• B) $20,000
• C) $25,000
• D) $28,000
• E) $60,000

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Definitions:

Factor Analysis

Factor Analysis is a statistical method used to describe variability among observed, correlated variables in terms of a potentially lower number of unobserved variables called factors.

Single Trait

Refers to focusing on one characteristic feature of an individual or system for study or analysis.

Normal Curve

A symmetrical, bell-shaped curve that describes the distribution of many types of data; most scores fall near the mean (about 68 percent fall within one standard deviation of it) and fewer and fewer near the extremes. Also called a normal distribution.

Standardization

Defining uniform testing procedures and meaningful scores by comparison with the performance of a pretested group.