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1. Is the allocation of acquisition cost to goodwill subjective? Discuss. 2. How does the allocation of acquisition cost to goodwill affect profit and cash

1. Is the allocation of acquisition cost to goodwill subjective? Discuss.

2. How does the allocation of acquisition cost to goodwill affect profit and cash flows in subsequent years? For your critical analysis, you could compare the effect of the accounting treatment of goodwill in subsequent years with the effect of the accounting treatment of property, plant and equipment (or intangibles with finite useful lives) in subsequent years.

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