Question

Goodwill can be recordeda. when customers keep returning because they are satisfied with the company's products.b. when the company acquires a good location for its business.c. when the company has exceptional management.d. only when there is an exchange transaction involving the purchase of an entire business.

Answer 1

Answer:

d. only when there is an exchange transaction involving the purchase of an entire business.

Explanation:

Goodwill: Goodwill is an intangible asset that is shown in the asset side of the balance sheet just like intellectual properties, trademark, etc. The goodwill is recognized when it is purchasing the business of the organization

The goodwill is computed by considering the consideration that is paid and the net assets value based on fair value.  

Hence, the most appropriate option is d. as the other reasons are not valid