When It Comes to Transferring Goodwill in a Business Valuation,goodwill

question 106

Multiple Choice

When it comes to transferring goodwill in a business valuation,goodwill:

• A)is considered an intangible asset and therefore not taxed.
• B)can be used as a deduction by the seller.
• C)is taxed for the seller as capital gains.
• D)cannot be used as a deduction by the buyer because it is a capital asset.

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Definitions:

Future Values

The value of an asset or cash at a specified date in the future that is equivalent in value to a specified sum today.

Compounded Monthly

A method of calculating interest where the accumulated interest is added to the principal amount at the end of each month.

Single Parent

An individual who has at least one child and raises them without the assistance of the other biological parent in the home.

Education

The systematic process of facilitating learning, or the acquisition of knowledge, skills, values, beliefs, and habits through methods such as teaching, training, storytelling, discussion, and directed research.