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Goodwill in accounting is an intangible asset that arises when a buyer acquires an existing business, but pays more than the fair market value of the net assets (total assets - total liabilities). The goodwill amounts to the excess of the "purchase consideration" (the money paid to purchase the asset or business) over the total value of the assets and liabilities. It is classified as an intangible asset on the balance sheet, since it can neither be seen nor touched. However, according to International Financial Reporting Standards (IFRS), goodwill is never amortized. Instead, management is responsible for valuing goodwill every year and to determine if an impairment is required. If the fair market value goes below historical cost (what goodwill was purchased for), an impairment must be recorded to bring it down to its fair market value. However, an increase in the fair market value would not be accounted for in the financial statements. ==Calculating goodwill== In order to calculate goodwill, the fair market value of identifiable assets and liabilities of the company acquired is deducted from the purchase price. For instance, if company A acquired 100% of company B, but paid more than the net market value of company B, a goodwill occurs. In order to calculate goodwill, it is necessary to have a list of all of company B's assets and liabilities at fair market value. Fair market value Accounts Receivable $10 Inventory $5 Accounts payable $6 Total Net assets = $10 + $5 - $6 = $9 In order to acquire company B, company A paid $20. Hence, goodwill would be $11 ($20 - $9). The journal entry in the books of company A to record the acquisition of company B would be: DR Goodwill $11 DR Accounts Receivable $10 DR Inventory $5 CR Accounts Payable $6 CR Cash $20 抄文引用元・出典: フリー百科事典『 ウィキペディア（Wikipedia）』 ■ウィキペディアで「Goodwill (accounting)」の詳細全文を読む スポンサード リンク
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