During a recent management meeting, Roger Bees, director of marketing, proposed that the com- pany should begin
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During a recent management meeting, Roger Bees, director of marketing, proposed that the com- pany should begin capitalizing its marketing expen- ditures as goodwill. In his words, "Marketing expen- ditures create goodwill for the company which benefits the company for multiple periods. Therefore it doesn't make good sense to have to expense it as it is incurred. Besides, if we capitalize it as goodwill we won't have to amortize it, and this will boost reported income." Discuss the merits of Roger's proposal.
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Financial Accounting Tools For Business Decision Making
ISBN: 9780471730514
4th Edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso
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