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WorksheetsValuation of Goodwill 2
Total questions: 15
Worksheet time: 7mins
While calculating capital employed the following assets are ignored.
fixed assets
floating assets
current assets
fictitious assets
In case of partnership firms, goodwill is valued at time of
admission of new partner
Retirement or death of partner
change in profit sharing ratio
all of the above
The present value of the firm’s anticipated excess earnings is
capital
Goodwill
FMP
super profits
Future maintainable profit – normal profit =
Average capital employed
Goodwill
Super profit
Capital employed
Capital employed =
Assets – outside liabilities
Assets - shareholder funds
Assets- Current liabilities
Assets - Long term liabilities
Average Capital Employed is calculated as
Capital employed-1/2 of current year profit
Capital employed-1/2 of past year profit
Capital employed - 1/2 of Average profits
Capital employed - current year profit
Goodwill is an
Intangible asset
Fictitious asset
Fixed asset
Current asset
Market rate of return on investment is 12% and rate of risk return on capital invested is 4%. The NRR is
(a)
If profits for the last four years was Rs.46,700 Rs. 51,200 Rs.55,000 and Rs.60,000. The average profits are
Rs.53,225
Rs.54,000
Rs. 53,910
Rs.55,410
Interest on investment is_____________ while calculating future maintainable profit.
Subtracted
Added
Multiplied
Divided
Formula for goodwill under capitalisation of super profits method____________
Super profit/Normal rate of reurn*100
FMP/NRR*100
SP*100/NRR
FMP*100/NRR
While calculating capital employed for ascertainment of goodwill, which one of the following is considered?
Unrecorded assets and liabilities
Goodwill
Fictitious assets
Investments
Following are the factors affecting goodwill except_______
Nature of business
Efficiency of management
Technical know-how
Location of the customers
While calculating goodwill, weighted average method should be followed when _______
profits are uneven
profits are with increasing trend
profits are with decreasing trend
Either "b" or "c"
If the NRR is 10% and Super profit is 20,000, calculate the goodwill as per capitalisation of super profits.
20,00,000
2,00,000
20,000
2,000
