Question on: WAEC Accounting - 2013
When a business is purchased from a sole trader, the excess of the purchase price over the net assets is
A
reserve
B
goodwill
C
feehold
D
valuation price
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Correct Option: B
Goodwill is recorded when a company acquires (purchases) another company and the purchase price is greater than the fair value of the identifiable tangible and intangible assets therein.
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