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B Com Exam  >  B Com Tests  >  Advanced Corporate Accounting  >  Test: Valuation Of Goodwill And Shares - 1 - B Com MCQ

Test: Valuation Of Goodwill And Shares - 1 - B Com MCQ


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10 Questions MCQ Test Advanced Corporate Accounting - Test: Valuation Of Goodwill And Shares - 1

Test: Valuation Of Goodwill And Shares - 1 for B Com 2024 is part of Advanced Corporate Accounting preparation. The Test: Valuation Of Goodwill And Shares - 1 questions and answers have been prepared according to the B Com exam syllabus.The Test: Valuation Of Goodwill And Shares - 1 MCQs are made for B Com 2024 Exam. Find important definitions, questions, notes, meanings, examples, exercises, MCQs and online tests for Test: Valuation Of Goodwill And Shares - 1 below.
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Test: Valuation Of Goodwill And Shares - 1 - Question 1
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In the context of business acquisitions, goodwill arises when the purchase price of a company exceeds the fair value of its:

Detailed Solution for Test: Valuation Of Goodwill And Shares - 1 - Question 1
Goodwill is the excess of the purchase price over the fair value of the net identifiable assets (tangible assets plus identifiable intangibles, net of liabilities).
Test: Valuation Of Goodwill And Shares - 1 - Question 2
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Which of the following is NOT a factor influencing the valuation of shares?

Detailed Solution for Test: Valuation Of Goodwill And Shares - 1 - Question 2
The size of the board of directors is not typically a factor that influences the valuation of shares.
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Test: Valuation Of Goodwill And Shares - 1 - Question 3
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What is the purpose of valuing shares in the context of a company?

Detailed Solution for Test: Valuation Of Goodwill And Shares - 1 - Question 3
Valuing shares is necessary for various purposes, including legal requirements, taxation, mergers, acquisitions, and more.
Test: Valuation Of Goodwill And Shares - 1 - Question 4
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Which method of valuing goodwill is based on the future maintainable profits of a firm?
Detailed Solution for Test: Valuation Of Goodwill And Shares - 1 - Question 4
The capitalisation method values goodwill based on the future maintainable profits and the normal rate of return.
Test: Valuation Of Goodwill And Shares - 1 - Question 5
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What is the purpose of adjusting profits in the valuation of goodwill using the future maintainable profit concept?
Detailed Solution for Test: Valuation Of Goodwill And Shares - 1 - Question 5
Adjusting profits helps eliminate non-recurring and extraordinary items to estimate the future maintainable profit accurately.
Test: Valuation Of Goodwill And Shares - 1 - Question 6
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In the capitalisation method, what is calculated based on the normal rate of return and the adjusted average profit?
Detailed Solution for Test: Valuation Of Goodwill And Shares - 1 - Question 6
The capitalised value of profit is calculated using the normal rate of return and the adjusted average profit.
Test: Valuation Of Goodwill And Shares - 1 - Question 7
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Which valuation method involves multiplying the super-profit by a certain number of years' purchase?
Detailed Solution for Test: Valuation Of Goodwill And Shares - 1 - Question 7
The capitalisation method involves multiplying super-profit by a certain number of years' purchase to determine goodwill.
Test: Valuation Of Goodwill And Shares - 1 - Question 8
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The sliding scale method for valuing goodwill involves:
Detailed Solution for Test: Valuation Of Goodwill And Shares - 1 - Question 8
The sliding scale method adjusts the multiplication of super-profit based on different ranges of profit.
Test: Valuation Of Goodwill And Shares - 1 - Question 9
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Which method of valuing goodwill takes into account the future profits of the business?
Detailed Solution for Test: Valuation Of Goodwill And Shares - 1 - Question 9
The Super-Profit Method considers the future profits of the business to determine the value of goodwill.
Test: Valuation Of Goodwill And Shares - 1 - Question 10
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What is the main difference between the simple average profit method and the weighted average profit method?
Detailed Solution for Test: Valuation Of Goodwill And Shares - 1 - Question 10
The weighted average profit method assigns different weights to past years' profits for a more accurate valuation of goodwill.
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