Question

Calculation of goodwill and shares difference between

Answer 1

Answer:

Explanation:

It is also called Purchase of Past Profit Method or Average Profit Basis Method: Average Profit = Total Profits for all the years/Number of years Value of Goodwill = Average Profit × Years' Purchase. 12. Total value of Goodwill = Rs. 22,000 × 5 = Rs. 1, 10,000 Aparna's share of Goodwill Rs. 1, 10,000 × 1/6 = Rs

Answer 2

The goodwill to assets ratio formula is calculated by dividing total assets by the total goodwill found on the company's balance sheet. ... Companies typically only have goodwill on their balance sheets if they purchase another company or asset for more than the book value or fair market value of the company or asset.