Which of the Following Is the Amount Capitalized as Goodwill

question 155

Multiple Choice

Which of the following is the amount capitalized as goodwill?

• A) The excess of the cost of an acquired company over the sum of the market value of its net assets
• B) The excess of the cost of an acquired company over the sum of the book value of its assets
• C) The excess of the cost of an acquired company over the sum of the book value of its net assets
• D) The excess of the cost of an acquired company over the sum of the market value of its assets

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Definitions:

Stockholders

Individuals or entities that own shares in a corporation, giving them certain rights like voting on corporate affairs.

Tax Rate

The chunk of financial earnings a corporation or individual pays as tax.

Depreciation Expense

Breaking down the cost of a hard asset over its life of utility.

Comprehensive Income

A measure of all changes in equity of an enterprise during a period, except those resulting from investments by and distributions to owners.