Bargain purchase elements are accounted for in a symmetrical manner to accounting for goodwill.

Question

Quizplus · Accepted Answer

Bargain purchase elements are accounted for differently than goodwill. Bargain purchases occur when the purchase price of an acquisition is less than the fair value of its net assets, leading to a gain in the acquirer's financial statements, whereas goodwill represents an excess of purchase price over the fair value of the net assets acquired and is recorded as an asset.

Bargain Purchase Elements Are Accounted for in a Symmetrical Manner