Define Goodwill and Identify the Possible Components of This Intangible

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The Answer is Goodwill is a residual that remains after the acquirer's interest in the identifiable tangible assets,intangible assets,liabilities and contingent liabilities of the acquiree are recognised.The possible components of goodwill (identified by Johnson and Petrone,1998,p.295)include (1)excess of the fair values over the book values of the acquiree's recognised assets (2)fair values of other net assets not recognised by the acquiree (3)fair value of the ongoing concern element of the acquiree's existing business (4)fair value from combining the acquirer's and acquiree's businesses and net assets (5)overvaluation of the consideration paid by the acquirer and (6)overpayment (or Underpayment)by the acquirer.

Define Goodwill and Identify the Possible Components of This Intangible

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