Which of the following can be amortized?

Goodwill is an intangible asset that arises when a business is acquired for more than the fair market value of its identifiable net assets. It reflects factors such as brand reputation, customer relationships, and employee relations that add value to the acquired business. Under accounting principles, goodwill is subject to amortization over a defined period, although recent regulations often allow for it to be tested for impairment instead of amortization.

The reason goodwill can be amortized is that it represents a long-term investment that is used in the operations of the business. Amortization spreads the cost of this intangible asset over its useful life, allowing companies to match expenses with revenues more effectively.

In contrast, real estate taxes are considered current expenses and are deducted in the period they are incurred. Inventory is classified as a current asset and is not amortized; instead, it is valued under different accounting methods based on cost of goods sold. Interest expense is typically not amortized in the accounting sense but is deducted in the year it is incurred. Therefore, the unique characteristics of goodwill make it the correct answer for this question about amortization.