Question

Goodwill is a. Seldom reported because it is too difficult to measure. b. Generally smaller for small companies and increases in amount as the companies acquired increase in size. c. Reported when the fair value of the acquiree is higher than the fair value of the net identifiable assets acquired. d. Reported when more than book value is paid in purchasing another company.

Answer 1

Answer:

(C) Reported when the fair value of the acquiree is higher than the fair value of the net identifiable assets acquired. 

Explanation:

Through accounting, goodwill is an intangible asset that occurs when an investor acquires an existing business. Goodwill includes properties which can't be identified separately.

Goodwill is reported when a business acquires (purchases) another firm and the purchase price exceeds the fair value of the measurable tangible and intangible assets purchased, minus the expected liabilities.