Which of the following observations concerning "goodwill" is NOT correct?
A. It must be reported as a separate line item in the balance sheet.
B. A goodwill impairment loss must be reported as a separate line item within income from continuing operations unless it relates to discontinued operations.
C. Once written down, it may be written up for recoveries.
D. It must be tested for impairment at least annually.
Answer: C
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For emphasis, one should place an idea in an independent clause; for de-emphasis, place an idea in a dependent clause
Indicate whether the statement is true or false
Melody, age 17, makes a contract with Seung, who is an adult. Melody:
a. may exercise the power of avoidance, called disaffirmance, while still a minor, and thereby be released from any liability on the contract. b. may ratify the contract while still a minor, thereby surrendering the power of avoidance. c. has entered a void contract since she lacked capacity. d. may disaffirm only after reaching the age of majority.
Natalie is interested in valuing the shares of Union Aerospace (UA). UA pays dividends annually. She expects the stock to pay dividends of $3 at the end of each of the next four years
Thereafter, she expects the dividend to grow at 7% per annum in perpetuity. If her required return is 12%, then how much should she pay for a share? A) $43.63 B) $45.54 C) $47.24 D) $49.91 E) $73.31
The difference between the price and the par value of a zero-coupon bond represents ________
A) taxes payable by the bond buyer B) the accumulated principal over the life of the bond C) the bond premium D) the accumulated interest over the life of the bond