Regarding Impairment of Intangible Assets,which of the Following Statements Is

question 74

Multiple Choice

Regarding impairment of intangible assets,which of the following statements is incorrect?

• A) Impairment occurs when the fair value of an intangible asset is less than the book value.
• B) Intangible assets are impaired when there has been a permanent decline in the value of the asset.
• C) Intangible assets with an indefinite life are tested for impairment annually.
• D) If any impairment occurs, the company records a loss in the period in which the intangible asset was acquired.

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Definitions:

Connecting Link

A piece or component that joins two or more parts together in a mechanism or system.

Income Statement

A financial report showing a company's revenues, expenses, and profits over a specific period of time.

Balance Sheet

A balance sheet is a financial statement that presents the assets, liabilities, and shareholders' equity of a company at a specific point in time, offering a snapshot of its financial condition.

Statement of Stockholder's Equity

A financial document that shows changes in the equity section of a company's balance sheet, including retained earnings and issued shares.