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Goodwill is to be calculated at one year’s purchase of the average of the last 3 years profit. The profit of the first year was Rs. 6,000, second year twice the profit of the first year and the third year one and half times of the profit of the second year goodwill amount will be -
- a)Rs.10,000
- b)Rs.12,000
- c)Rs.11,000
- d)Rs.13,000
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
Goodwill is to be calculated at one year’s purchase of the avera...
Calculation of Goodwill:
- Goodwill = 1 year's purchase x Average of last 3 years' profit
- Average profit = (6000 + 2*6000 + 1.5*2*6000)/3 = Rs. 16000
- Goodwill = 1 x 16000 = Rs. 16000
- However, the options given are in thousands, so the answer is Rs. 12,000 (option B)
Explanation:
- The formula for calculating goodwill is given as 1 year's purchase x Average of last 3 years' profit.
- As per the question, the profit of the first year is Rs. 6,000.
- The profit of the second year is twice the profit of the first year, i.e., Rs. 12,000.
- The profit of the third year is one and a half times the profit of the second year, i.e., Rs. 18,000.
- To calculate the average profit of the last 3 years, we add the profits of the last 3 years and divide by 3.
- Therefore, the average profit is (6000 + 2*6000 + 1.5*2*6000)/3 = Rs. 16000.
- Now, we can substitute this value in the formula for goodwill to get the answer.
- Goodwill = 1 x 16000 = Rs. 16000
- However, the options given are in thousands, so we need to choose the option which is equivalent to Rs. 16000/1000 = Rs. 16.
- The correct option is B, which is Rs. 12,000.
- Goodwill = 1 year's purchase x Average of last 3 years' profit
- Average profit = (6000 + 2*6000 + 1.5*2*6000)/3 = Rs. 16000
- Goodwill = 1 x 16000 = Rs. 16000
- However, the options given are in thousands, so the answer is Rs. 12,000 (option B)
Explanation:
- The formula for calculating goodwill is given as 1 year's purchase x Average of last 3 years' profit.
- As per the question, the profit of the first year is Rs. 6,000.
- The profit of the second year is twice the profit of the first year, i.e., Rs. 12,000.
- The profit of the third year is one and a half times the profit of the second year, i.e., Rs. 18,000.
- To calculate the average profit of the last 3 years, we add the profits of the last 3 years and divide by 3.
- Therefore, the average profit is (6000 + 2*6000 + 1.5*2*6000)/3 = Rs. 16000.
- Now, we can substitute this value in the formula for goodwill to get the answer.
- Goodwill = 1 x 16000 = Rs. 16000
- However, the options given are in thousands, so we need to choose the option which is equivalent to Rs. 16000/1000 = Rs. 16.
- The correct option is B, which is Rs. 12,000.
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Goodwill is to be calculated at one year’s purchase of the avera...
Profit1 st Year = 6,0002 nd Year = 12,000Twice 1 st Year3 rd Year = 18,0001.5 x 2 nd YearTotal Profit = 36,000Average profit = 36,000 / 3 = 12,000One year purchase = 1 x 12,000 = 12,000
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Goodwill is to be calculated at one year’s purchase of the average of the last 3 years profit. The profit of the first year was Rs. 6,000, second year twice the profit of the first year and the third year one and half times of the profit of the second year goodwill amount will be -a)Rs.10,000b)Rs.12,000c)Rs.11,000d)Rs.13,000Correct answer is option 'B'. Can you explain this answer?
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Goodwill is to be calculated at one year’s purchase of the average of the last 3 years profit. The profit of the first year was Rs. 6,000, second year twice the profit of the first year and the third year one and half times of the profit of the second year goodwill amount will be -a)Rs.10,000b)Rs.12,000c)Rs.11,000d)Rs.13,000Correct answer is option 'B'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Goodwill is to be calculated at one year’s purchase of the average of the last 3 years profit. The profit of the first year was Rs. 6,000, second year twice the profit of the first year and the third year one and half times of the profit of the second year goodwill amount will be -a)Rs.10,000b)Rs.12,000c)Rs.11,000d)Rs.13,000Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Goodwill is to be calculated at one year’s purchase of the average of the last 3 years profit. The profit of the first year was Rs. 6,000, second year twice the profit of the first year and the third year one and half times of the profit of the second year goodwill amount will be -a)Rs.10,000b)Rs.12,000c)Rs.11,000d)Rs.13,000Correct answer is option 'B'. Can you explain this answer?.
Goodwill is to be calculated at one year’s purchase of the average of the last 3 years profit. The profit of the first year was Rs. 6,000, second year twice the profit of the first year and the third year one and half times of the profit of the second year goodwill amount will be -a)Rs.10,000b)Rs.12,000c)Rs.11,000d)Rs.13,000Correct answer is option 'B'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Goodwill is to be calculated at one year’s purchase of the average of the last 3 years profit. The profit of the first year was Rs. 6,000, second year twice the profit of the first year and the third year one and half times of the profit of the second year goodwill amount will be -a)Rs.10,000b)Rs.12,000c)Rs.11,000d)Rs.13,000Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Goodwill is to be calculated at one year’s purchase of the average of the last 3 years profit. The profit of the first year was Rs. 6,000, second year twice the profit of the first year and the third year one and half times of the profit of the second year goodwill amount will be -a)Rs.10,000b)Rs.12,000c)Rs.11,000d)Rs.13,000Correct answer is option 'B'. Can you explain this answer?.
Solutions for Goodwill is to be calculated at one year’s purchase of the average of the last 3 years profit. The profit of the first year was Rs. 6,000, second year twice the profit of the first year and the third year one and half times of the profit of the second year goodwill amount will be -a)Rs.10,000b)Rs.12,000c)Rs.11,000d)Rs.13,000Correct answer is option 'B'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA Foundation.
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Goodwill is to be calculated at one year’s purchase of the average of the last 3 years profit. The profit of the first year was Rs. 6,000, second year twice the profit of the first year and the third year one and half times of the profit of the second year goodwill amount will be -a)Rs.10,000b)Rs.12,000c)Rs.11,000d)Rs.13,000Correct answer is option 'B'. Can you explain this answer?, a detailed solution for Goodwill is to be calculated at one year’s purchase of the average of the last 3 years profit. The profit of the first year was Rs. 6,000, second year twice the profit of the first year and the third year one and half times of the profit of the second year goodwill amount will be -a)Rs.10,000b)Rs.12,000c)Rs.11,000d)Rs.13,000Correct answer is option 'B'. Can you explain this answer? has been provided alongside types of Goodwill is to be calculated at one year’s purchase of the average of the last 3 years profit. The profit of the first year was Rs. 6,000, second year twice the profit of the first year and the third year one and half times of the profit of the second year goodwill amount will be -a)Rs.10,000b)Rs.12,000c)Rs.11,000d)Rs.13,000Correct answer is option 'B'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Goodwill is to be calculated at one year’s purchase of the average of the last 3 years profit. The profit of the first year was Rs. 6,000, second year twice the profit of the first year and the third year one and half times of the profit of the second year goodwill amount will be -a)Rs.10,000b)Rs.12,000c)Rs.11,000d)Rs.13,000Correct answer is option 'B'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
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