Quote:
| Originally Posted by azcheer How is negative goodwill recognized on a consolidated balance sheet? |
When a company purchases another company below the fair value they have a negative goodwill. The difference betweeen the book value of the company and the money paid creates the negative goodwill. The negative goodwill reduces certain assets acquired (I believe it is just the long assets that are reduced). If any remaining credit exists (
which is rare), it is accounted for as an extraordinary gain.
This is for the purchase method
Linear Mode
