Yellow Media Inc T.YLO

RE: RE: A thought

[onereality]

"Very interesting. Onereality doesn't know what the item Goodwill represents."

I can see our Pine Troll is fishing for someone to talk to . Ok Piny here is a little education on the basics. Goodwill includes "The value of your good name"..read

Goodwill (accounting)

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Accountancy

Key concepts

Accountant·Accounting period·Accrual·Bookkeeping·Cash and accrual basis·Cash flow forecasting·Chart of accounts·Convergence·Journal·Special journals·Constant item purchasing power accounting·Cost of goods sold·Credit terms·Debits and credits·Double-entry system·Mark-to-market accounting·FIFO and LIFO·GAAP / IFRS·General ledger·Goodwill·Historical cost·Matching principle·Revenue recognition·Trial balance

Fields of accounting

Cost·Financial·Forensic·Fund·Management·Tax (U.S.)

Financial statements

Balance Sheet·Cash flow statement·Income statement·Statement of retained earnings·Notes·Management discussion and analysis·XBRL

Auditing

Auditor's report·Control self-assessment·Financial audit·GAAS / ISA·Internal audit·Sarbanes–Oxley Act

Accounting qualifications

CA·CPA·CCA·CGA·CMA·CAT·CIIA·IIA·CTP

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Goodwill is an accounting concept meaning the value of an entity over and above the value of its assets. The term was originally used in accounting to express the intangible but quantifiable "prudent value" of an ongoing business beyond its assets, resulting perhaps because the reputation the firm enjoyed with its clients.

Contents

• 1Modern meaning
• 2US practice
  • 2.1History and purchase vs. pooling-of-interests
  • 2.2Amortization and adjustments to carrying value
• 3See also
• 4References

Modern meaning

For example, a software company may have net assets (consisting primarily of miscellaneous equipment, and assuming no debt) valued at $1 million, but the company's overall value (including brand, customers, intellectual capital) is valued at $10 million. Anybody buying that company would book $10 million in total assets acquired, comprising $1 million physical assets, and $9 million in goodwill. In a private company, goodwill has no predetermined value prior to the acquisition; its magnitude depends on the two other variables by definition. A publicly traded company, by contrast, is subject to a constant process of market valuation, so goodwill will always be apparent.

"What's a intangible number? How does it differ from a tangible number?"

I will give you a down to earth example that will (should) make it clear what the difference is and why banks do not give a horse's butt about intangibles

Joe has a restaurant. The land, building and equipment are owned by him and have a fair market value of $1 million. Joes restaurant is very successful. People flood to it because of his famous hamburgers. Joe has copyrighted the name "Joe's Hamburgers" and given it an intangible value of $2 Million. This is based on that name being hung on a restaurant face will bring in business, therefore the right to use the name "Joes Hamburgers" has value.

One day Joe get greedy and stupid. To up his profit he starts putting horse meat in his hamburgers. It is discovered, he is charged and it is all over the newspapers. No one will go to Joes Hamburgers any more and he goes bankrupt. At the auction that land, building and equipment that was previously valued at $1 million still is and is sold for that because it is a tangible that has nothing to do with Joe. Now the rights to use the name "Joes Hamburgers" that he had previously given a $2 million intangible value to comes up for auction. No one even bids a dollar.

That is an example of the difference between a tangible and intangible asset and why banks will not allow it as collateral against the very tangible 'Money'.