Goodwill

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Dictionary Says

Definition of 'Goodwill'

An account that can be found in the assets portion of a company's balance sheet. Goodwill can often arise when one company is purchased by another company. In an acquisition, the amount paid for the company over book value usually accounts for the target firm's intangible assets.
Investopedia Says

Investopedia explains 'Goodwill'

Goodwill is seen as an intangible asset on the balance sheet because it is not a physical asset like buildings or equipment. Goodwill typically reflects the value of intangible assets such as a strong brand name, good customer relations, good employee relations and any patents or proprietary technology.

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Related Definitions

  1. Intangible Asset

    An asset that is ...

  2. Negative Goodwill

    A gain occurring ...

  3. Badwill

    The negative ...

  4. Target Firm

    A company which ...

  5. Brand

    A distinguishing ...

  6. Patent

    A government ...

  7. Tangible Asset

    Assets that have ...

  8. Book Value

    1. The value at ...

  9. Tangible Common Equity - TCE

    A measure of a ...

  10. Identifiable Asset

    An asset of an ...

Articles Of Interest

  1. Accounting Rules Could Roil The Markets

    FAS 142 is an accounting rule that changes the way companies treat goodwill. Be aware of the impact it has on reported earnings to avoid making bad investment decisions.

  2. The Basics Of Mergers And Acquisitions

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  3. Can You Count On Goodwill?

    Carefully examine goodwill and its sources before considering the value of your investment.

  4. Impairment Charges: The Good, The Bad And The Ugly

    Impairment charge is a term for writing off worthless goodwill, but you need to know what its potential impact is on EPS.

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  9. Analyze Cash Flow The Easy Way

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  10. Digging Into Book Value

    This calculation will serve up your portion of the shareholder pie.
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