How goodwill is tested for impairment

Assignment Help Accounting Basics
Reference no: EM13129137

On january 1, 2008, line corporation acquired all of the common stock of staff company for 300,000 on the date, staff's identifiable assets had a fair value of 250,000. the assets acquired in the purchase of the staff are considered to be separate reporting unit of line corporation. the carrying value of staff's investment at december 31, 2008, is 310,000. the fair value of the net assets ( excluding goodwill) at the date is 220,000 and the fair value of the reporting unit is determined to be 260,000.

Required: 1) explain how goodwill is tested for impairment for a reporting unit. 2) determine the amount, if any, of impairment loss to be recognized at december 31, 2008.

Reference no: EM13129137

Questions Cloud

What are the operating characteristics for system : Copying times average 8 minutes according to an exponential distribution. What are the operating characteristics for this system?
How much copper (i) sulfide would be produced : If 5.68 g of Cu was added to 3.18 g of S8, How much copper (I) sulfide would be produced?
Letting go : "Letting Go" is a poem written by Daryl Hine, a Canadian poet. As implied by the title of the poem, the author talks about the scenario in whichthe speaker is letting go of his lover, although he still loves his lover very much. Daryl Hine was born i..
Define the role played by dna and rna in genetic diseases : Discuss, in detail, the role played by DNA and RNA in genetic diseases. What are the breakthroughs, if any, in the treatment/management of genetic diseases?
How goodwill is tested for impairment : 1) explain how goodwill is tested for impairment for a reporting unit. 2) determine the amount, if any, of impairment loss to be recognized at december 31, 2008.
What is ph of a 0.050 molar solution of sodium hypoiodite : The ionization constant, Ka, for HOI(aq), hypoiodous acid, is 2.3 × 10-11. What is the pH of a 0.050 molar solution of sodium hypoiodite, which contains the hypoiodite ion?
Find the probability that the poll gets a sample : What is the probability that the poll gets a sample in which fewer than 45% say they do not get enough time for themselves. Show your method.
Prepare shortworkings accounts in the books of company : Year 1 production nil. year 2 production 6000.3rd year 24000 4th year 60000 5th year 45000 prepare shortworkings accounts in the books of company for five years.
Create and interpret confidence interval for population mean : A sample of 15 workers reveal the following minutes: 29, 38, 38, 33, 38, 21, 45, 34, 40, 37, 42, 30, 29, 35. Develop 98% confidence interval for the population mean. Interpret your result.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Journal entries for capital stock transactions

Flores Corporation recently hired a new accountant with extensive experience in accounting for partnerships. Because of the pressure of the new job, the accountant was unable to review his textbooks on the topic of corporation accounting.

  Preventative controls

Discuss the nature of preventive controls that may be designed into an AIS. Give an example and explain how it may prevent fraud or abuse of the system.

  Beginner model using abc costing

The company expects to incur $56,400 of total inspecting costs this year. How much of the inspecting costs should be allocated to the Beginner model using ABC costing?

  Allocate the costs and advise

Please allocate the costs and advise, what is the taxable income for year 1 and 2, noting there are no other expenses outside the allocation of costs.

  Journal entries-common-preferred-treasury stock

Consider the recording of journal entries related to common, preferred, and treasury stock. How does the record-keeping of these entries relate to business?

  Receipt of the semiannual interest payment

Griggs Company holds $50,000 of 8% bonds as a held-to-maturity security. Which of the following is the correct journal entry to record the receipt of the semiannual interest payment.

  Which is closest to the present value of the project

Upper Darby Park Department is considering a new capital investment. The following information is available on the investment. The cost of the machine will be $150,000.

  Balance sheet exposure

What is" balance sheet exposure". When converting a balance sheet from one currency to another currency what rate do we use? Are all balance sheet accounts adjusted as of the balance sheet date?

  Contango market and backwardation market

Write down the difference between a contango market and a backwardation market. What exactly is meant by a basis?

  What are the risks for accounting systems

What are the differences between substantive tests of transactions and tests of details of balances?

  Comparative analysis-common size and dupont formula

Compute a common-size analysis in Excel and discuss the differences between the two corporations.

  Eitf reporting implications for reporting

Assess how a company's accounting and financial reporting is likely to be impacted by the work being done by the EITF on this issue.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd