Chapter No. 3 – Goodwill: Nature and Valuation – Solution – Class 12 of the all practical problems with the animation and videos. First of all you can read the meaning of the Goodwill as following.
Goodwill is the value of a company or firm in the eyes of the customer. If any business has more market share then it will have a higher value of goodwill.
What is Goodwill: –
When one business acquired in a whole or some percentage of share of another business for the amount which is more than the total assets of that business. That amount of difference which is paid extra is known as goodwill. It is a tangible asset.
Now question is that why business pay extra from the total value of the assets of the business?
There any reasons for that but some of the important are shown as under:
- Higher market share
- More customer reliability
- Satisfied employees
- or have a proprietary technology
Please check the article:
What is Goodwill -Definitions and Factors affecting its value
Chapter No. 3 – Goodwill: Nature and Valuation – Solution
Check out T.S. Grewal Book Keeping +2 @ Official Website of Sultan Chand Publication
