Question

Which of the following statements about consolidated goodwill is true?

Q: Answer-Which of the following statements about consolidated goodwill is true?

Goodwill arising on consolidation is the excess of the consideration transferred over the acquirers interest in the fair value of the identifiable net assets acquired. It is not amortized but is tested for impairment annually.

A Goodwill is amortised every year as per an arbitrary schedule

B Goodwill is recognised when purchase consideration > fair value of identifiable net assets; subsequently tested for impairment

C Goodwill equals subsidiary's retained earnings only

D Negative goodwill is always recorded as capital reserve only

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Which of the following statements about consolidated goodwill is true?

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