What Is the Amount of Goodwill Arising from This Business

question 9

Multiple Choice

What is the amount of goodwill arising from this business combination?

• A)$5,000
• B)$150,000
• C)($5,000)
• D)Nil.

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Definitions:

Factor

A financial company that purchases receivables from businesses, providing them with immediate cash.

Impairment

Impairment is a reduction in the recoverable value of an asset below its carrying value, leading to an expense in the income statement.

Receivable

An amount of money owed to a company by its customers or clients for goods or services provided on credit.

IFRS

The International Financial Reporting Standards (IFRS) are a set of accounting standards developed by the International Accounting Standards Board (IASB) for the preparation of financial statements globally.