The company believes that these efforts have increased the fair value of the entire company by $325,000. How much goodwill can the company recognize at the end of the year associated with these expenditures?

Question

Business

Lilian Perez

10 May, 05:08

The company believes that these efforts have increased the fair value of the entire company by $325,000. How much goodwill can the company recognize at the end of the year associated with these expenditures?

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Answers (1)

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Irvin Villarreal · Answer 1

Options:

$230,000. $80,000. $0. $325,000.

Answer:

The correct option is 0$.

Explanation:

These costs are expensed as incurred and are not capitalized as goodwill because they are costs of doing business and not associated with the acquisition of another business.