Please try to get the correct answer Question 8 (7 points) The Great Corporation

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Please try to get the correct answer

Question 8 (7 points) The Great Corporation bought several other companies a few years ago and recognized a large amount of goodwill. In preparing financial statements for the current year, one of the reporting units in this business combination has a significant portion of that goodwill. At the end of the current year, officials have looked at a variety o qualitative factors and believe that there is a 59 percent chance that this particular reporting unit has a fair value that is larger than its current carrying value. What is the impact of this determination? Question 8 options: A) There is no impact based on this determination. B) The reporting unit must now perform tests to determine if the goodwill balance has been impaired. C C) No further testing is needed this year for this reporting unit as far as goodwill impairment is concerned D) Goodwill is impaired according to this information and must be written down and a loss recognized

Explanation / Answer

answer

A ) there is no impact based on the determination

goodwill is said to be impaired when the fair value is less than the current carrying value

there is 59% chance that this particular reporting unit has a fair value that is larger than its

current carrying value

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