addresses Goodwill is 350-20 and the codification that addresses the other intangible assets is 350-30. To continue‚ according to codification 350-20-20 goodwill is‚ “an asset representing the future economic benefits arising from other assets acquired in a business combination or an acquisition by a not-for-profit entity that are not individually identified and separately recognized”. In addition‚ according to codification 350-20-35-1‚ “Goodwill shall not be amortized. Instead‚ goodwill shall be
Premium Asset Goodwill Balance sheet
viewed under the different accounting standards for these divisions of its company. When we are using IFRS to examine an impairment of Eagle’s Italy building‚ one is recognized “if‚ and only if‚ the recoverable amount of the building is less than its carrying amount. The carrying amount of the asset shall be reduced to its recoverable amount. That reduction is an impairment loss.” (IAS 36-59). In order to see if this IFRS is present we must first determine the recoverable amount‚ which is the higher
Premium Generally Accepted Accounting Principles Asset Depreciation
leads to consuming of shareholders’ equity and changeable of rate-of-return measures. With this method‚ goodwill will remain in the pre-regulation period. Second method is ‘systematic write- off’‚ which is regularly written off over a limited period. This method is also called amortization that is under AAS 18 and AASB 1013. The third method is ‘ad- hoc write- off’‚ which can be called as impairment under AASB 136. This method is permanent and can remain unlimited in the balance sheet unless evidence
Premium Balance sheet Generally Accepted Accounting Principles Asset
and the adjusting goodwill for impairment. The adjusting lower cost of market inventory on valuation is specified in Accounting Research Bulletin No. 43 (ARB No. 43). The Statement of Financial Accounting Standards (SFAS) No. 34 is the statement‚ which deals with capitalization of interest as part of the cost of the asset. The SFAS No. 144 addresses the reporting and accounting for the impairment of the disposal of long-lived assets. New rules for the accounting for goodwill have been addressed
Premium Asset Generally Accepted Accounting Principles Depreciation
A SYNOPSIS OF ACCOUNTING FOR BUSINESS COMBINATIONS‚ INTANGIBLES AND GOODWILL IMPAIRMENT INTRODUCTION During the 1980 ’s and 1990 ’s a great number of business mergers and acquisitions took place. The generally accepted accounting principles to record the initial transaction and to account for the acquired assets during their estimated useful lives this were well established. Over time however‚ users of financial statements began to question whether those principles and practices accurately
Premium Asset Balance sheet Goodwill
Goodwill Impairment and Fair Value Measurement: Hewlett-Packard’s Acquisition of Autonomy Abstract In today’s business environment‚ mergers and acquisitions are becoming increasingly common. Mergers and acquisitions create many accounting challenges including issues of fair value measurement and the associated topic of goodwill impairment. The fair value measurement of an acquired company usually entails using a Level 2 fair value estimate‚ or using a market or income approach‚ both level three
Premium Balance sheet Generally Accepted Accounting Principles Mergers and acquisitions
there is an impairment loss of $77 000. The impairment loss is firstly used to write off the goodwill - $50 000. The balance of the loss - $27 000 – is allocated across the other assets‚ except for inventory assuming it is recorded at the lower of cost and net realisable value: Carrying Proportion Allocation Net Carrying Amount of Loss Amount Factory 250 000 5/6 22 500 227 500 Brand 50 000 1/6 4 500 45 500 300 000 27 000 The journal entry to record the impairment loss is:
Premium Asset
References: AccountingCoach. (2012). Retrieved from http://www.accountingcoach.com/online- accounting-course/27Xpg04.html Goodwill impairment. (2011). In Bankopedia. Retrieved from http://www.bankopedia.net/goodwill-impairment-definition/ Putra‚ . (2012). Accounting and Financial Tax. Retrieved from http://accounting- financial-tax.com/2009/02/how-are-goodwill-impairment-losses-accounted/ Schroeder‚ R. G.‚ Clark‚ M. W.‚ & Cathey‚ J. M. (2011). Financial accounting theory and analysis: Text
Premium Balance sheet Asset Generally Accepted Accounting Principles
S. GAAP and IFRSs. Recoverability test is one of the requirement tests for impairment. As a result‚ we need to verify if impairment should be recognized. 2. The impairement is $600‚000. GAAP methodology of determining impairment uses a two-step recoverability test. Step one‚ requires a company to estimate the future undiscounted cash flows expected from the use of that asset and its eventual disposition. If impairment has occurred‚ step two would determine the loss by subtracting the fair value
Premium Generally Accepted Accounting Principles Goodwill Depreciation
Six Flags Analysis of Goodwill ACCT 6610 Six Flags‚ Inc. is the largest regional theme park operator in the world. Currently Six Flags operates 18 parks in the US‚ one in Canada and one in Mexico. In the aggregate‚ Six Flags’ theme parks offer over 800 rides‚ including more than 120 roller coasters. The following questions pertain to Six Flags’ goodwill. To begin‚ obtain a copy of Six Flags‚ Inc. December 31‚ 2008 10-K‚ which was filed with the SEC March 11‚ 2009. A link to the report
Premium Management Marketing Strategic management