Accounting 204-051 Spring 2015 Test 1 7. Goodwill is: A. Amortized over the greater of its estimated life or 40 years B. The excess of the fair value of a business over the fair value of all net identifiable assets C. Only recorded by the seller of a business. D. None of the above. 8. The capitalized cost of equipment excludes: A. Installation. B. Sales tax. C. Shipping. D. Maintenance. 9. When selling property, plant, and equipment for cash: A. The seller recognizes a gain or loss for the difference between the cash received and the fair value of the asset sold. B. The seller recognizes losses, but not gains. C. The seller recognizes a gain or loss for the difference between the cash received and the book value of the asset sold. D. None of the above. 10 Assets acquired in a lump-sum purchase are valued based on: A. Their relative fair values. B. Their assessed valuation. C The present value of their future cash flows. D. Their cost plus the difference between their cost and fair values. 11. Assets acquired by the issuance of equity securities are valued based on: A. Their fair values. The fair value of the equity securities. A or B, whichever is smaller. A or B, whichever is more reasonably determinable