Question 04 Chapter 3 of +2-Part-1
4. (Average Profit Method) Rani purchased Vani’s business on 31st March 2015. The profit disclosed by Vani business for the last three years were as follows:
Year
2013: Rs.40,000 (including an abnormal gain Rs.5,000)
2014: Rs.50,000(after charging an abnormal loss of Rs.10,000)
2015: Rs.45,000(excluding Rs.5,000 as insurance premium of firms property now to be insured)
Calculate the value of firm’s Goodwill on the basis of 2 years purchase of the average profit for the last three years.
The solution of Question 04 Chapter 3 of +2 Part-1: –
| Calculation of Adjusted Profit |
|||
| Year |
Profit | Adjustments | Adjusted Profit |
| 2013 | 40,000 | -5,000 | 35,000 |
| 2014 | 50,000 | + 10,000 | 60,000 |
| 2015 | 45,000 | – 5,000 | 40,000 |
| Total | 1,35,000 | ||
| Average Adjusted Profit | = | Total Profit for past given years |
| Number of years | ||
| = | 35,000 + 60,000 + 40,000 | |
| 3 | ||
| = | 1,35,000 | |
| 3 | ||
| = | 45,000 |
| Number of years’ purchase | = | 2 |
| Goodwill | = | Average Profit X Number of years’ purchase |
| Goodwill | = | 45,000 X 2 |
| Goodwill | = | 90,000 |
Working Note : –
*1 Calculation of Profits of last three years
| Adjusted Profit for the year 2013 | = | Total Profit − Abnormal Gain |
| = | 40,000 – 5,000 | |
| = | 35,000 |
| Adjusted Profit for the year 2014 | = | Total Profit +Abnormal Loss |
| = | 50,000 + 10,000 | |
| = | 60,000 |
| Adjusted Profit for the year 2015 | = | Total Profit − Indirect Expenses |
| = | 45,000 – 5,000 | |
| = | 40,000 |
Thanks, Please Like and share with your friends
Comment if you have any questions.
Advertisement-X
End of Solution
Check Out the Solution of all questions of this chapter:
The solution to all questions of Chapter No. 3 – Partnership Accounts – II (Goodwill: Nature and Valuation) Class 12 Usha Publication – 2024 is shown as follows, click on the image of the question to get the solution.
Advertisement-Y
Advertisement-Y
Advertisement-Y
Thanks for completing the chapter. If you understand the question or we have helped you with your homework, please share our website on your social media. We are delighted to help you out.
Thanks again.
End of Post
Download a PDF of Chapter No. 3 – Partnership Accounts – II (Goodwill: Nature and Valuation):
If you want to download a PDF of this chapter then you can do it. Check out our PDF file on our Store page.
Chapter-Wise Solution of Usha Publication Accountancy – Part 1 Class 12 – Session 2024-25 as per the PSEB curriculum
Check out Solutions to all questions of the every chapter shown as under. The Solution of Accountancy – Part 1 Class 12 – Session 2024-25 is provided as per the new book published by Usha Publication.
Chapter No. 1 – Accounting Not-for-Profit Organisations (Deleted from the Syllabus)
Chapter No. 2 – Partnership Accounts – I (Introduction)
Chapter No. 3 – Partnership Accounts – II (Goodwill: Nature and Valuation)
Advertisement-X
Chapter No. 4 – Partnership Accounts – III (Reconstitution of Partnership)
Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner)
Chapter No. 6 – Partnership Accounts – V (Retirement and Death of A Partner)
Chapter No. 7 – Partnership Accounts – VI (Dissolution of Partnership Firm)
Also, Check out our Comprehensive Chapter-wise solution of Advanced Accountancy Part 1 Class 12 by Unimax Publication
- Chapter No. 1 – Accounts of Non-Profit Organisations (Deleted from the Syllabus)
- Chapter No. 2 – Partnership Accounts – I (Basic Concepts)
- Chapter No. 3 – Partnership Accounts – II (Goodwill)
- Chapter No. 4 – Partnership Accounts – III (Change in Profit Sharing Ratio among Existing Partners)
- Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner)
- Chapter No. 6 – Partnership Accounts – V (Retirement and Death of A Partner)
- Chapter No. 7 – Partnership Accounts – VI (Dissolution of Partnership Firm)
Check out Part 2 of both books.
In Class 12th the accountancy has 2 books i.e. Part 1 and Part 2. The Books related to the Part 1 are shown above. but If you want to know more about Part 2, you can check it out from the following links. We have provided the links to both books i.e. Accountancy Part 2 by Usha Publication and Advanced Accountancy Part 2 by Unimax Publication.
1. Accountancy – Part 2 Class 12 – Session 2024-25 By Usha Publication
2. Advanced Accountancy Part 2 Class 12 by Unimax Publication