What does goodwill mean?

Goodwill refers to the potential economic benefits that can generate economic profits for business in the future, and may refer to the significance of obtaining a higher profit rate than normal capital under the same conditions.

1. Goodwill is an intangible project, which comes from the overall image of the company and the goodwill of consumers to the company. This goodwill comes from the company's superior geographical location, good reputation, beneficial business impact, good employers and employees, exclusive rights and good leadership, so it belongs to the amortization of intangible assets.

2, goodwill can create indirect economic benefits for the company, it is often a meaningful property, precisely because of its efficiency characteristics, it is the capitalization price of the difference between the company's investment rate of return and the average income calculated according to social development.

3. Goodwill cannot be owned independently. It has the characteristics of attachment, which is closely related to the company's equity capital and the living environment of the enterprise, that is, it can not be sold or sold independently, nor can it be invested as an independent project. There will be no independent transfer significance, and we can only rely on the company as a whole.

4. The evaluation of goodwill is a kind of asset report evaluation, and its evaluation method lies in understanding the meaning of goodwill. The value of goodwill goods is expressed by the company's return on investment, which belongs to a kind of amortization of intangible assets with high combination and adhesion. Only by adopting the whole method can it be measured, and it cannot be measured as a single item like many tangible intangible assets amortization.