Madison Inc.acquires 100% of the voting stock of Allison Corp.for $10.0 million.Allison's total assets at fair value equaled $12.5 million and Allison had liabilities at fair value equal to $3.4 million.Madison will report goodwill of $0.9 million.

Goodwill

An intangible asset that arises when a buyer acquires an existing business, representing the premium paid over the fair value of the net identifiable assets.

Voting Stock

Shares that give the stockholder the right to vote on matters of corporate policy making and the election of the board of directors.

Fair Value

The price at which an asset or liability could be exchanged between knowledgeable, willing parties in an arm's length transaction.