Question

Ans: Goodwill = 71,41,600. 4A. X Ltd. proposed to purchase the business carried on by Y Ltd. Goodwill for the purposes agreed to be value at two years' purchase of the weighted average profits of the past fra years. The appropriate weights to be used are: 2004: 1, 2005: 2, 2006: 3, 2007:4 The profits of these years are 2004: * 40,400, 2005: * 49,600, 2006: 240,000, 2007: 360,00 On the scrutiny of the accounts following information was revealed: (1) On 1" September, 2006 a major repair was made in respect of the plant incurra *12,000 which amount was charged to the revenue. This paid amount is to be capitalise for the calculation of goodwill subject to the adjustment of depreciation of 10%p.a . om reducing balance method. (ii) The closing stock of the year 2005 was over valued by 4,800. (iii) To cover management cost an annual charge of 9,600 should be made for the purpose of goodwill valuation. Compute the value of the goodwill of the business. Ans: Goodwill: * 87,712. 4B Follo​

Answer 1

Answer:

Isn't that the answer? lol but if not, this is what I found...

Let the average profit or loss in year 2006 be x millions,

The average profit for the 8-year period, is the total sum of the profits (or losses) of each year, divided by 8:

so we have:

x=8-10.45=-2.45

Answer: the loss in 2006, was 2.45 million dollars

Explanation:

Hope this helps:)  ジョセフ