The Treatment of Internally Generated Goodwill Varies from Purchased Goodwill

question 4

Multiple Choice

The treatment of internally generated goodwill varies from purchased goodwill under AASB 138 in that:

• A) Purchased goodwill is not amortised whereas internally generated goodwill is assumed to be maintained indefinitely.
• B) Purchased goodwill may be recorded as an asset, whereas internally generated goodwill may not.
• C) Internally generated goodwill is to be amortised over a period of no greater than 20 years, whereas purchased goodwill may not be recorded.
• D) Purchased goodwill is to be expensed in the period it is bought whereas internally generated goodwill is to be deferred and amortised over a period of no less than 20 years.
• E) None of the given answers.

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Definitions:

Fishery Product

A fishery product refers to any product or commodity derived from fish, including food items, fish oil, and other byproducts obtained through fishing or aquaculture.

Market Value

The current price at which an asset or service can be bought or sold in a open market.

Property Rights

Legal rights to use, control, and derive benefit from a resource, property, or asset.

Overexploited Fisheries

Fisheries where fish stocks have declined below a level that can sustainably support fishing activity due to excessive fishing.