[ISC] Q. 14 Goodwill Solution TS Grewal Class 12 (2023-24)

Solution to Question number 14 of the Goodwill chapter 2 TS Grewal Book ISC Board 2023-24 Edition.

Calculate the goodwill of a firm on the basis of three year’s purchase of the weighted average profit of the last four financial years. The appropriate weights to be used and profits are:

Year	Profits (₹)
2019 – 20	1,01,000
2020 – 21	1,24,000
2021 – 22	1,00,000
2022 – 23	1,40,000

On a scrutiny of the accounts, the following information was taken:

i) On 1st December, 2021, a major repair was made in respect of the plant incurring ₹ 30,000 which was charged to revenue. The said sum is agreed to be capitalised for goodwill calculation subject to adjustment of depreciation of 10% p.a. on Reducing Balance Method.

ii) The closing stock for the year ended 31st March, 2021 was overvalued by ₹ 12,000.

iii) To cover management cost, an annual charge of ₹ 24,000 should be made for the purpose of goodwill valuation.

iv) On 1st April 2020, a machine having a book value of ₹ 10,000 was sold for ₹ 11,000 but the proceeds were wrongly credited to Profit & Loss Account. No effect has been given to rectify the same. Depreciation is charged on machine @ 10% p.a. on Reducing balance Method.

Solution:-

List of all solutions of Goodwill chapter TS Grewal ISC Board class 12 (2023-24)

S.N	Questions
1	Question – 1
2	Question – 2
3	Question – 3
4	Question – 4
5	Question – 5
6	Question – 6
7	Question – 7
8	Question – 8
9	Question – 9
10	Question – 10

S.N	Questions
11	Question – 11
12	Question – 12
13	Question – 13
14	Question – 14
15	Question – 15
16	Question – 16
17	Question – 17
18	Question – 18
19	Question – 19
20	Question – 20

S.N	Questions
21	Question – 21
22	Question – 22
23	Question – 23
24	Question – 24
25	Question – 25
26	Question – 26
27	Question – 27
28	Question – 28
29	Question – 29
30	Question – 30

S.N	Questions
31	Question – 31
32	Question – 32
33	Question – 33
34	Question – 34
35	Question – 35
36	Question – 36