USGAAP Requires an Impairment Test for Goodwill If ________

question 81

Multiple Choice

U.S.GAAP requires an impairment test for goodwill if ________.

• A)the fair value of the reporting unit (including goodwill)is greater than the fair value of its net assets (without goodwill)
• B)the fair value of the reporting unit (including goodwill)is less than the fair value of its net assets (without goodwill)
• C)the fair value of the reporting unit (including goodwill)is less than the book value of the reporting unit (without goodwill)
• D)the fair value of the reporting unit (including goodwill)is less than the book value of the reporting unit (including goodwill)

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Definitions:

Billings

Billings refer to the total amount of revenue recognized by a company before deducting expenses, often in the context of a professional firm.

Construction In Progress

This refers to the balance sheet classification of the cost of construction projects that are not yet complete.

Liability

A financial obligation or debt owed by a business to another entity, which requires settlement through the transfer of assets or services.

Revenue Recognition

The process by which companies document and account for their income, specifically defining when and under what circumstances revenue is considered earned.