38) Twilight Corporation acquired End-of-the-World Products on
January 1, 2008 for $2,000,000, and recorded goodwill of $375,000 as
a result of that purchase. At December 31, 2008, the End-of-theWorld Products Division had a fair value of $1,700,000. The net
identifiable assets of the Division (excluding goodwill) had a fair
value of $1,450,000 at that time. What amount of loss on impairment
of goodwill should Twilight record in 2008?
39) Fleming Corporation acquired Out-of-Sight Products on January
1, 2008 for $4,000,000, and recorded goodwill of $750,000 as a result
of that purchase. At December 31, 2008, the Out-of-Sight Products
Division had a fair value of $3,400,000. The net identifiable assets of
the Division (excluding goodwill) had a fair value of $2,900,000 at
that time. What amount of loss on impairment of goodwill should
Fleming record in 2008?
40) When a patent is amortized, the credit is usually made to
41) The reason goodwill is sometimes referred to as a master
valuation account is because
42) Easton Company and Lofton Company were combined in a
purchase transaction. Easton was able to acquire Lofton at a bargain
price. The sum of the market or appraised values of identifiable assets
acquired less the fair value of liabilities assumed exceeded the cost to
Easton. After revaluing noncurrent assets to zero, there was still some
"negative goodwill." Proper accounting treatment by Easton is to
report the amount as
43) Stock dividends distributable should be classified on the
44) Which of the following statements is false?
45) Which of the following items is a current liability?
46) Simson Company has 35 employees who work 8-hour days and
are paid hourly. On January 1, 2006 the company began a program of
granting its employees 10 days of paid vacation each year. Vacation
days earned in 2006 may first be taken on January 1, 2007.
Information relative to these employees is as follows:
What is the amount of expense relative to compensated absences that
should be reported on Simson’s income statement for 2006?
47) A company offers a cash rebate of $1 on each $4 package of
batteries sold during 2007. Historically, 10% of customers mail in the
rebate form. During 2007, 6,000,000 packages of batteries are sold,