LearningCat: Goodwill in Mergers and Acquisitions

Understanding Goodwill on Consolidation
Within the field of mergers and acquisitions (M&A), goodwill becomes a major component reflecting the intangible value resulting from synergies, brand equity, and customer interactions. Goodwill on consolidation catches the premium paid above the fair value of net identifiable assets when a parent firm bundles its financial statements with subsidiaries. Under strict accounting rules, this […]
Allocation of Purchase Price with Respect to Goodwill
When a company purchases another company, the deal goes beyond a basic ownership change. Reflecting their fair valuations, the whole purchase price paid should be distributed among the purchased assets and liabilities. Goodwill, which is the extra paid above net asset fair value, is a vital part of this allocation. Strategic decisions, taxation, and financial […]