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Need help with 9706_S06_qp_4
- Thread starter bill920
- Start date
the formula for calculating the value of goodwill is 
urchase price of business-fair value of net assets purchased
= 135000-((30000+16000+6000+4000)-4750)
=83750
Note:donot take bank into account as it is mentioned in the Question that all assets and liabilities are taken over "except" bank account.
Premises before purchase(Chin ltd)=120000
anjni's business' premises purchased=30000
upward revaluation of premises(equivalent to bonus issue)=100000(can also be calculated by taking it as a balancing figure in balance sheet)
total value=250000
urchase price of business-fair value of net assets purchased= 135000-((30000+16000+6000+4000)-4750)
=83750
Note:donot take bank into account as it is mentioned in the Question that all assets and liabilities are taken over "except" bank account.
Premises before purchase(Chin ltd)=120000
anjni's business' premises purchased=30000
upward revaluation of premises(equivalent to bonus issue)=100000(can also be calculated by taking it as a balancing figure in balance sheet)
total value=250000
sry,i thin it is difficult