When an organization is sold,the purchase price may be higher than the total value of the physical and financial assets.This difference is sometimes called ____.

Question

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Goodwill is a common term used to describe the difference between the purchase price and the total value of physical and financial assets during the sale of an organization. Goodwill represents the intangible value of the business, such as its reputation, brand recognition, customer relationships, and other non-physical assets that contribute to its overall value. The value of goodwill is subjective and can vary based on factors such as industry trends, market conditions, and buyer perception.

When an Organization Is Sold,the Purchase Price May Be Higher