On January 1, 2020 Herald acquires 100% of Tribune and will operate Tribune as a wholly owned subsidiary. Herald's purchase price was less than the fair value of the net assets of Tribune. How is this handled
When the purchase price is lower than the fair market value, accountants generally refer to this as negative goodwill. All negative goodwill must be reported as a gain.
Another way to refer to this type of situation is a bargain purchase (lower price than FMV).
