Goodwill Is an Intangible Asset That the Business Buyer Cannot

question 49

True/False

Goodwill is an intangible asset that the business buyer cannot depreciate or amortize for tax purposes.

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Definitions:

Fictitious Payee Rule

A legal principle that states if a negotiable instrument is made payable to a fictitious person, the entity that neglects to verify the authenticity of the payee can be held liable for any resulting loss.

Imposter Rule

A rule which holds that if one party obtains a negotiable instrument by impersonating another party and endorses it with the impersonated party’s signature, the loss falls on the drawer of the instrument.

Drawer

In financial terms, the person who writes or issues a check, directing a bank to pay the stated amount from the drawer's account.

Discharged Liability

The release or elimination of a debtor's obligation to pay a debt, typically occurring through bankruptcy proceedings.