Goodwill-Financial Reporting Considerations Cabot Corporation's Balance Sheet at December 31, 2009, Includes an 2009

Essay

Goodwill-financial reporting considerations
Cabot Corporation's balance sheet at December 31, 2009, includes an asset entitled goodwill in the amount of $900,000, net of accumulated amortization.
(a) Briefly explain what is meant by the term goodwill.
(b) Under what circumstances is goodwill recorded in the accounting records? Include in your Answer a specific situation in which Cabot would have recorded the goodwill mentioned above.