Final answer:
The statement that goodwill cannot be amortized is false. Goodwill is subject to an annual impairment test under GAAP, but it was previously possible to amortize goodwill under IFRS before the standards were revised to require an annual impairment test.
Step-by-step explanation:
The statement 'Goodwill associated with the acquisition of a business cannot be amortized' is false. According to the generally accepted accounting principles (GAAP), goodwill is an intangible asset that represents the excess of the purchase price over the fair market value of identifiable assets and liabilities acquired in a business combination. It is not amortized but instead is subject to an annual impairment test. If during the impairment test the carrying value of goodwill is found to be greater than its fair value, an impairment loss must be recognized.
In contrast, International Financial Reporting Standards (IFRS) previously allowed for the option to amortize goodwill over its useful life. However, due to a revision in the standards, IFRS now requires an annual impairment test, similar to GAAP.