Accounting goodwill is measured and identified as the difference between the amount paid for a firm and the net fair value of the assets and liabilities acquired This accounting goodwill is an attempt to quantify economic goodwill Required a What is economic profit as it would be defined in finance or economics Use a numerical example to illustrate the difference b Why is accounting net income not the same as an economists determination of earnings, as measured from a shareholders perspective

Question: Accounting goodwill is measured and identified as the difference between the amount paid for a firm and the net fair value of the assets and

Accounting is measured and identified as the difference between the amount paid for a firm and the net fair value of the assets and liabilities acquired. This accounting is an attempt to quantify economic .
Required:
a. What is economic profit as it would be defined in finance or economics? Use a numerical example to illustrate the difference.
b. Why is accounting net income not the same as an economist’s determination of earnings, as measured from a shareholder’s perspective?

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