Kallus Corp. is an industry leader in the manufacture of toys. Each year, its design staff comes

Question:

Kallus Corp. is an industry leader in the manufacture of toys. Each year, its design staff comes up with new ideas that are a great success. As a result, Kallus’s sales and profits consistently exceed those of other toy manufacturers. Over the past 10 years, Kallus has earned average net profits of $ 189 million, compared to $ 122 million for the typical company in the toy industry.

Required:
Answer the following questions:
a. Does Kallus have ? Explain.
b. Is an asset? Explain. (Does it meet the definition of an asset found in SFAS No. 6 ?)

c. If you believe Kallus has goodwill, how would you go about measuring it? Explain.

d. Should Kallus Corp. report in the balance sheet? Why, or why not? Goodwill
Goodwill is an important concept and terminology in accounting which means good reputation. The word goodwill is used at various places in accounting but it is recognized only at the time of a business combination. There are generally two types of...