Problem:
Accounting rules have a substantial effect on financial statements. How do companies account for and apply goodwill? Consider the article "Talbots Inc. and Subsidiaries: Accounting for Goodwill" (Bruns, 2008). Next, using outside sources that you may seek and your professional experience, develop and write a 3 page paper concisely answering the following questions:
1) If you were an accountant for Talbots, what specifically would be the relevant accounting research question relating to the case?
2) What accounting standards must Talbots consider when answering the question?
3) What must be known, estimated, and assumed to answer the research question?
4) Do you believe Talbots' accounting for goodwill in the case was appropriate? Why or why not? Is it possible to arrive at an alternative accounting treatment of goodwill based on your analysis?