Although the SEC Guidance Is Developed for Public Companies,the Concepts

question 40

True/False

Although the SEC guidance is developed for public companies,the concepts regarding materiality are sound and could be followed by private companies and other organizations.

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Definitions:

Goodwill

An intangible asset that is created from such favorable factors as location, product quality, reputation, and managerial skill.

Boot

The remaining amount a buyer owes after the trade-in allowance when a fixed asset is traded in for a similar asset.

Accumulated Depreciation

Represents the total amount of depreciation expense that has been recorded for a fixed asset since it was put into use.

Intangible Assets

Assets that lack physical substance but possess value, such as patents, trademarks, and goodwill.