Page 5 - GOODWILL QUESTIONS 12

Question: 18 of 36 QID: 164 Marks: 1

Goodwill is to be calculated at one and half years purchase of average profit of last 5 years. The firm earned profits during first 3 years as,
Rs.20,000, Rs.18,000 and Rs.9,000 and suffered losses of Rs.2,000 and 5,000 in last 2 years. Goodwill amount will be :

A. Rs.12,000 B. Rs.10,000

NARULA ACADEMY
C. Rs.15,000 D. None

Question: 19 of 36 QID: 165 Marks: 1

What does not affect the goodwill of the firm ?

A. Better customer's service B. Location of firms

C. Personal reputation D. None of these

Question: 20 of 36 QID: 166 Marks: 1

Capital employed by M/s PQR is Rs.5,00,000. Rate of normal profit is 20%. Past four year’s profits were as follows :

Year Profit (Rs.)
1 1,20,000

2 1,80,000

3 1,50,000

4 2,00,000

Calculate value of goodwill at 2 years purchase using super profit method :

A. Rs.3,25,000 B. Rs.1,25,000

C. Rs.3,12,500 D. Rs.1,62,500

Question: 21 of 36 QID: 167 Marks: 1

A and B share profits and losses in the ratio 2 : 1.

C is admitted with 1/4th share in profits

C acquired 3/4th of his share in profits from A and 1/4th of his share from B. New profit and loss sharing ratio will be :

A. 2 : 1 : 1 B. 23 : 13 : 12

C. 3 : 1 : 1 D. 1 : 1 : 1

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