The amount paid for goodwill should be small enough to be recovered with new profits in a reasonably short time period.

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gabby robinson · Accepted Answer

Final Answer : True, Explanation :  Goodwill is an intangible asset that represents the excess value paid over the net assets of a company during an acquisition. It is expected that the benefits of the acquisition, such as synergies, brand value, and customer relationships, will generate enough new profits to recover the cost of goodwill in a reasonably short time period, ensuring the investment is financially sound.

The amount paid for goodwill should be small enough to be recovered with new profits in a reasonably short time period.

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