Question : Identify the correct order for calculating goodwill under Capitalisation of Average Profit Method: (i) Calculate capitalised value of the firm (ii) Ascertain the value of net assets, on the date of valuation of goodwill (iii) Calculate average profit earned (iv) Find the difference between capitalised value of the firm and net assets
Option 1: (i), (ii), (iii), (iv)
Option 2: (ii), (iii), (iv), (i)
Option 3: (iii), (i), (ii), (iv)
Option 4: (iv), (iii), (ii), (i)
Correct Answer: (iii), (i), (ii), (iv)
Solution : For calculating goodwill under Capitalisation of Average Profit Method: (iii) Calculate average profit earned (i) Calculate capitalised value of the firm (ii) Ascertain the value of net assets, on the date of valuation of goodwill (iv) Find the difference between capitalised value of the firm and net assets. Hence, the correct option is 3.
Question : Directions: Arrange the given words in the sequence in which they occur in the dictionary. i. Treasure ii. Treadmill iii. Training iv. Translate
Question : Directions: Arrange the given words in the sequence in which they occur in the dictionary. i. Monopoly ii. Manifesto iii. Manifold iv. Mankind
Question : Directions: Arrange the given words in the sequence in which they occur in the dictionary: i. Examination ii. Explicit iii. Expenditure iv. Experience
Question : Directions: Arrange the given words in the sequence in which they occur in the dictionary: i. Latitude ii. Longitude iii. Laugh iv. Latent
Question : A firm earned Rs. 60,000 as profit, the normal rate of return being 10%. Assets of the firm are Rs. 7,20,000 (excluding goodwill) and Liabilities are Rs. 2,40,000. The value of goodwill by Capitalisation of Average Profit Method is
Regular exam updates, QnA, Predictors, College Applications & E-books now on your Mobile