WorksheetsValuation of Shares & Goodwill
Total questions: 24
Worksheet time: 12mins
Nature of goodwill is
intangible asset
fictitious asset
long term liability
current asset
Which of the following factor(s) affect goodwill
Nature of business
Efficiency of management
Location
All of the above
Find out that goodwill which is accounted for as per Accounting Standard 26
Purchased goodwill only
Self generated goodwill only
both(a) and (b)
Goodwill brought in by a partner
The profits for the last 3 years were- 1st year-4,000 ,IInd year-6,000 and IIIrd year-2,000.Select correct option for goodwill on the basis of 3 years purchase of average profit.
₹ 12,500
₹ 12,000
₹ 13,000
₹ 16,000
Super profit =
Average profit-Normal profit
Normal profit-actual profit
Average Profit-capital employed
None of the above
Goodwill by super profit=
SPxNRR/100
SPx100/AP
SPx No of year purchase
SPx capital employed/100
Capital Employed=
Tangible assets- outside liabilities
Average profit-Tangible assets
Super profit -outside liabilities
None of the above
How many general method(s) of goodwill valuation
6
1
4
3
The present value of the firm’s anticipated excess earnings is
capital
Goodwill
FMP
super profits
While calculating capital employed the following assets are ignored.
fixed assets
floating assets
current assets
fictitious assets
Future maintainable profit – normal profit =
Average capital employed
Goodwill
Super profit
Capital employed
Market rate of return on investment is 12% and rate of risk return on capital invested is 4%. The NRR is
(a)
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
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
Goodwill is valued at 4 years purchase of super profits. Normal return of Shyam Ltd. is Rs. 17688. Actual Profit of Shyam Ltd. is Rs. 38760. Value Goodwill.
Rs. 70752
Rs. 1,55,040
Rs. 84,288
Rs. 21,072
The _______________ is printed on the share certificate.
Face Value
Book Value
Market Value
Fair Value
Net assets of company divided by no. of shares =
Book Value
Fair Value
Yield Value
Intrinsic Value
Under ___________ method , Value of share is calculated by comparing the Expected Rate of Dividend of a company with Normal Rate of Dividend as prevailing in that industry.
Net Asset Value Mathod
Dividend Yield Method
Earning Capacity Method
Fair Value Method
Value of share is calculated by comparing the Rate of Earnings of a company with Normal Rate of Return as prevailing in that industry.
Net Asset Value Method
Dividend Yield Method
Earning Capacity Method
Fair Value Method
If Intrinsic value of share is Rs. 177.20 ; Yield value is Rs. 255.17 ; Calculate fair value.
Rs. 216.18
Rs. 88.60
Rs. 127.59
Rs. 38.98
Net Asset Value method is based on the assumption that the company is ___________
a going concern
going to be liquidated
both the above
None of the above
Yield value depends on _____________
Future Maintainable Profit
Paid-up equity capital
Normal rate of return
all of the above
Yield value is based on the assumption that ____________
the company is a going concern
the company will be liquidated
the company is sick
none of the above
