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    Goodwill

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    Jann Vic Sales
    Goodwill is an intangible asset that arises when a business is acquired and represents assets that are not separately identifiable. Goodwill is the excess of the purchase price over the fair value of identifiable net assets acquired. Goodwill is classified as an intangible asset, is never amortized, and is subject to annual impairment testing.

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    Goodwill

    Uploaded by

    Jann Vic Sales
    6 views1 page
    Goodwill is an intangible asset that arises when a business is acquired and represents assets that are not separately identifiable. Goodwill is the excess of the purchase price over the fair value of identifiable net assets acquired. Goodwill is classified as an intangible asset, is never amortized, and is subject to annual impairment testing.

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    Goodwill is an intangible asset that arises when a business is acquired and represents assets that are not separately identifiable. Goodwill is the excess of the purchase price over the fair value of identifiable net assets acquired. Goodwill is classified as an intangible asset, is never amortized, and is subject to annual impairment testing.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    6 views1 page

    Goodwill

    Uploaded by

    Jann Vic Sales
    Goodwill is an intangible asset that arises when a business is acquired and represents assets that are not separately identifiable. Goodwill is the excess of the purchase price over the fair value of identifiable net assets acquired. Goodwill is classified as an intangible asset, is never amortized, and is subject to annual impairment testing.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    Goodwill

    Goodwill in accounting is an intangible asset that arises when a buyer acquires an

    existing business. Goodwill represents assets that are not separately identifiable. Goodwill does

    not include identifiable assets that are capable of being separated or divided from the entity and

    sold, transferred, licensed, rented, or exchanged, either individually or together with a related

    contract, identifiable asset, or liability regardless of whether the entity intends to do so. Goodwill

    also does not include contractual or other legal rights regardless of whether those are transferable

    or separable from the entity or other rights and obligations. Goodwill is also only acquired

    through an acquisition; it cannot be self-created. Examples of identifiable assets that are goodwill

    include a company’s brand name, customer relationships, artistic intangible assets, and any

    patents or proprietary technology. The goodwill amounts to the excess of the "purchase

    consideration" (the money paid to purchase the asset or business) over the net value of the assets

    minus liabilities. It is classified as an intangible asset on the balance sheet, since it can neither be

    seen nor touched. Under US GAAP and IFRS, goodwill is never amortized, because it is

    considered to have an indefinite useful life. Instead, management is responsible for valuing

    goodwill every year and to determine if an impairment is required. If the fair market value goes

    below historical cost (what goodwill was purchased for), an impairment must be recorded to

    bring it down to its fair market value. However, an increase in the fair market value would not be

    accounted for in the financial statements. Private companies in the United States, however, may

    elect to amortize goodwill over a period of ten years or less under an accounting alternative from

    the Private Company Council of the FASB.

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