12th Class Accountancy Goodwill Question Bank

done Case Based - Goodwill : Nature And Valuation Total Questions - 10

• question_answer1)
  You are required to answer the following questions 1 to 6:

  X and Y have started a business in partnership 6 years back and they were running their business without any problem. Due to Covid-19 Pandemic Lockdown they faced a lot of problem. After the Lockdown they found that they need more capital to establish their business once again. For this purpose they admitted a new partner Z. New ratio was decided 5:3:2. He brings Rs.7,00,000 as his capital and his share of goodwill in cash. It was decided that goodwill of the firm is to be calculated on the basis of 3 years purchase of the average profits of the last 5 years.

  Profits from the year when they started business to the date are as follows:

  Year 2015 -16 2016 -17 2017-18 2018 -19 2019 - 20 2020 - 21 Profit/loss 1,00,000 4,00,000 5,00,000 (60,000) 1,50,000 2,50,000

  Additional Information :

  (i) On 1st January, 2019, a fire broke out which resulted into a loss of goods of Rs.3,00,000. A claim of Rs.70,000 a as received from the insurance company.

  (ii) During the year ended 31st March, 2021 the firm received an unexpected tax refund of Rs.80,000.

  Adjusted profit/loss for the year 2018-19:

  A)
  Loss 60,000 done clear
  B)
  2,40,000 Profit done clear
  C)
  10,000 Profit done clear
  D)
  1,70,000 Profit done clear
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• question_answer2)
  Adjusted profit/loss for the year 2020-21:
  A)
  Profit 70,000 done clear
  B)
  2,50,000 Profit done clear
  C)
  3,30,000 Profit done clear
  D)
  2,00,000 Profit done clear
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• question_answer3)
  Total Adjusted profit will be:
  A)
  13,90,000 done clear
  B)
  14,90,000 done clear
  C)
  15,90,000  done clear
  D)
  16,90,000 done clear
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• question_answer4)
  Average adjusted Profit of the firm:
  A)
  2,98,000 done clear
  B)
  2,88,000 done clear
  C)
  2,78,000 done clear
  D)
  2,68,000 done clear
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• question_answer5)
  Goodwill of the firm will be:
  A)
  8,34,000 done clear
  B)
  8,94,000 done clear
  C)
  8,00,000 done clear
  D)
  8,50,000 done clear
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• question_answer6)
  Z's Share of premium for goodwill:
  A)
  1,78,800 done clear
  B)
  1,65,800 done clear
  C)
  1,75,800 done clear
  D)
  1,66,800 done clear
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• question_answer7)
  Answer the following question from the above information 7 to 10.

  A and B are partners sharing profits and losses in the ratio of 3 : 1. They agree to take C into partnership for 1/3rd share. For this purpose, goodwill is to be valued at two year's purchase of the average profit of last four years which were as follows:

  Year ending on 31st March 2018 = 4,00,000

  Year ending on 31st March 2019 = 5,00,000

  Year ending on 31st March 2020 = 6,00,000

  Year ending on 31st March 2021 = 7,00,000

  On a scrutiny of the accounts the following matters are revealed:

  (i) An abnormal loss of Rs.50,000 was incurred during the year ended 31st March, 2018.

  (ii) An abnormal Gain of Rs.50,000 was incurred during the year ended 31st March, 2020.

  (iii) Closing Stock as on 31st March 2019 was undervalued by Rs.40,000.

  (iv) Repairs to Car amounting to Rs.40,000 was wrongly debited to Car Account on 1st January, 2018. Depreciation was charged on Vehicles @ 10% p.a. on Straight Line Method.

  (v) To cover management cost an annual charge of Rs.4,800 should be made for the purpose of goodwill valuation.

  Adjusted Profit for the year ended 31.03.2020 will be:

  A)
  6,39,200 done clear
  B)
  5,09,200 done clear
  C)
  5,39,200 done clear
  D)
  6,09,200 done clear
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• question_answer8)
  Adjusted Profit for the year ended 31.03.2019 will be:
  A)
  4,06,200 done clear
  B)
  5,09,200 done clear
  C)
  5,39,200 done clear
  D)
  6,99,200 done clear
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• question_answer9)
  Average Adjusted profit will be:
  A)
  5,80,900 done clear
  B)
  5,39,200 done clear
  C)
  5,38,450 done clear
  D)
  5,00,200 done clear
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• question_answer10)
  Goodwill of the firm will be:
  A)
  10,76,900 done clear
  B)
  11,61,800 done clear
  C)
  10,78,400 done clear
  D)
  10,00,400 done clear
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