What is called the excess of purchase price over fair market value of net assets that are acquired under the purchase method of accounting ?
Correct answer: C. Goodwill
- A. Bonus
- B. Up level
- C. Goodwill
- D. Upgradation
Explanation
Goodwill is the excess of the purchase price over the fair market value of the identifiable net assets acquired. It represents benefits such as reputation, customer loyalty and established business relationships.
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