What Are The Types Of Goodwill?

What Are The Types Of Goodwill?

1 Answer

  1. Generally, there are two major types of goodwill. The first one being the purchased goodwill. Goodwill is an intangible asset and it could be seen that the purchased goodwill comes around when a business concern is purchased for an amount above the fair value of the separable acquired net assets. This type of goodwill is then written under assets in a balance sheet. They are the only types of goodwill which can be recognized on a company’s accounts. The second one is, inherent goodwill and it is a complete opposite of purchased goodwill. This type of goodwill is internally generated and arises over time due to reputation, and it can be either positive or negative. This is a great kind as it costs you nothing and you can gain a lot from it however it takes a lot of time to build inherent goodwill.
    Although there are three other classes of goodwill i.e., dog goodwill, cat goodwill and rat goodwill. You can read more about it on this link: https://efinancemanagement.com/financial-management/goodwill

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