Unformatted text preview: 100,000 425,000 Implied value of goodwill 155,000 Carrying value of goodwill 150,000 No impairment—implied value > carry value -0-Part c No changes in tangible assets or identifiable intangibles are reported based on goodwill impairment testing. The sole purpose of the valuation exercise is to estimate an implied value for goodwill. Destin will report a goodwill impairment loss of $20,000, which will reduce the amount of goodwill allocated to Sand Dollar. However, because the fair value of Sand Dollar’s trademarks is less than its carrying amount, the account should be subjected to a separate impairment testing procedure to see if the carrying value is “recoverable” in future estimated cash flows....
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This note was uploaded on 10/02/2009 for the course ACCT 401 taught by Professor Ross,m during the Spring '08 term at Western Kentucky University.
- Spring '08