Goodwill Valuation Quiz
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Questions and Answers

What is the primary reason for impairing goodwill?

  • Increase in future earning capacity
  • Rise in the consumer confidence index
  • Negative changes in the business environment (correct)
  • Decrease in market interest rates
  • How does an increase in the fair value of net identifiable assets affect the valuation of goodwill?

  • Increases the valuation of goodwill
  • Has no impact on the valuation of goodwill
  • Makes the valuation uncertain
  • Decreases the valuation of goodwill (correct)
  • Which of the following is a key factor in the valuation of goodwill?

  • Current market value of the liabilities
  • Number of shares outstanding
  • Historical cost of the assets
  • Brand reputation and customer loyalty (correct)
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