Goodwill is an intangible asset that arises because of the acquisition of one company by
another for a premium value. The value of a company’s brand name, solid customer base,
good customer relations, good employee relations and any patents or proprietary
technology represent goodwill.
Goodwill is considered an intangible asset because it is not a physical asset like buildings or equipment. The goodwill account can be found in the assets portion of a company’s balance sheet.