Note on BattleQuiz 19 - 2017.Fall 19 b

Under this card, there is a note:
also:
if goodwill > 0 → establish an asset equal to the goodwill amount
if goodwill < 0 → recognize immediately as operating income gain

Does this apply to GAAP only or both SAP and GAAP?

Thanks!

Comments

  • That applies just to GAAP. I edited the BattleCard to make it more clear. Thx!

  • Also, under GAAP's goodwill formula, shouldn't it be

    GAAP goodwill = P - (net assets) = P - [FV(assets) - FV(liabilities)] = P - FV(assets) + FV(liabilities) ?

    Thanks!

  • Yup!! I fixed it and gave you a double shout-out. Thx!

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