CFA Practice Question

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CFA Practice Question

________ measures the premium paid over market value to acquire an asset.

A. Reputed value
B. Goodwill
C. Patents
Correct Answer: B

The premium paid in excess of market value is for the goodwill that a company has created in its line of business.

User Contributed Comments 1

User Comment
wundac Goodwill: Intangible asset representing the difference between the purchase price of an asset and its fair market value. Ex: Goodwill is created when a bank pays a premium to acquire the assets of another bank in a take-over transaction
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