Goodwill is best described as the:
A) value of intangible assets of the target company.
B) premium of the purchase price over the value of the stock prior to the announcement of the acquisition bid.
C) difference between the purchase price for the target company and the fair market value of the assets of the target.

Question

Quizplus · Accepted Answer

Goodwill is the difference between the purchase price for the target company and the fair market value of its assets. It represents the excess amount paid over the tangible and identifiable intangible assets, capturing elements like brand reputation, customer relationships, and intellectual property that are not separately identifiable or valued in the purchase.

Goodwill Is Best Described as The