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Question 2 The accounting treatment for goodwill has been widely discussed and debated over years. Discuss relevant issues for each of the following with
Question 2 The accounting treatment for goodwill has been widely discussed and debated over years. Discuss relevant issues for each of the following with reference to appropriate accounting standards when applicable. (a) Discuss the arguments for and against the recognition of goodwill as an asset. (12 marks) (b) Explore the various major ways that goodwill has been accounted for over the years. Discuss the strengths and weaknesses of each method. (c) (14 marks) How does negative goodwill arise when acquiring a subsidiary? Briefly discuss the appropriate accounting treatment for negative goodwill. (4 marks)
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