Which of the Following Statements Is Correct Regarding Accounting Treatment

Which of the following statements is correct regarding accounting treatment of goodwill?

A) Goodwill is recorded as an asset and then amortized over a period of 5 years.
B) Goodwill is recorded as an asset. It is not amortized but must be tested for impairment each year.
C) Goodwill is recorded as an asset and amortized over 40 years unless its value decreases.
D) Goodwill is expensed immediately in the year of purchase.

Correct Answer:

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