Types of Goodwill

1. Purchased Goodwill
Purchased goodwill refers to the goodwill that arises when the amount of purchase consideration exceeds the value of the net identifiable assets.

2. Non-Purchased Goodwill / Inherent Goodwill
The goodwill that is generated over a long period of time due to good reputation and image of the business is called non-purchased goodwill. Non-purchased or inherent goodwill is internally generated within the business due to factors used in the business.

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