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Hello Sir,
The merger ( A) purchased the merged (B), So,the whole assets and liabilities of (B) transmitted to (A) books in its fair value, and the difference between the purchase cost and the (B) fair value = goodwill shown at (A) books , is that right ?
Ok ,if the (B) will not be exist any more (its name and its trade mark) after merge , why A pay more than the fair value ( goodwill) ?
Thanks“… and the difference between the purchase cost and the (B) fair value = goodwill shown at (A) books , is that right ?”
No, that’s not right.
Goodwill is an amount that appears from the process of preparing consolidated financial statements
The investment by the acquirer (NOT the merger!) will be shown in the parent’s own financial accounting records as “Investment in acquiree (NOT the merged)” and it will be shown at cost
“Ok ,if the (B) will not be exist any more (its name and its trade mark) after merge , why A pay more than the fair value ( goodwill) ?”
What makes you think that the acquiree will not exist after the acquisition? Where have you got that idea from? Certainly not from me!
Of course the acquiree (the subsidiary) will continue to exist – why wouldn’t it?
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