The way goodwill was explained to me is: If you buy Coca-Cola Corporation you get tangible assets like the manufacturing plants and work in progress which can

The way goodwill was explained to me is: If you buy Coca-Cola Corporation you get tangible assets like the manufacturing plants and work in progress which can be valued fairly simply. But you also buy the Coca-Cola brand, which is intangible and difficult to value. And yet it obviously has value - nobody thinks the value of Coca-Cola is entirely in its bottling plants. So we just kinda say, "I guess it's worth what you just paid for it" and put it in the accounts as the difference between the purchase price and the value of the assets that can be valued.