A factor that contributes to recording goodwill when acquiring control of another company is ________.
A) outstanding management skills of parent company
B) unique product manufactured by parent company
C) established brand names by investee company
D) all of the above

Question

Quizplus · Accepted Answer

Goodwill is the amount paid for an acquisition in excess of the net identifiable assets acquired. It is attributed to intangible assets such as the investee company's established brand names, customer relationships, and patents. The outstanding management skills of the parent company or unique product manufactured by parent company are not factors that directly contribute to the recognition of goodwill.

A Factor That Contributes to Recording Goodwill When Acquiring Control