The book value of a dental practice is $400,000. The dental practice was purchased for $480,000. The additional $80,000 is recorded on the books as ____.

Question

Quizplus · Accepted Answer

The additional $80,000 paid over the book value of the dental practice is recorded as goodwill, which is an intangible asset representing the excess of the purchase price over the fair value of the net assets of the acquired business.

The Book Value of a Dental Practice Is $400,000