Tybaf || Valuation Of Goodwill

20 Questions | Total Attempts: 50

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Tybaf || Valuation Of Goodwill


Questions and Answers
  • 1. 
    Which of the following statement is true
    • A. 

      EVA shows the economic profit of the Co.

    • B. 

      For calculation of EVA WACC is required

    • C. 

      Both a & b

    • D. 

      None of the Above

  • 2. 
    EPS depends on
    • A. 

      Net profit available to equity shareholders

    • B. 

      None of the Above

    • C. 

      Net profit available to preference shareholders

    • D. 

      Both a & b

  • 3. 
    MVA is
    • A. 

      Market Value Added

    • B. 

      Machinery Value Added

    • C. 

      Both a & b

    • D. 

      None of the Above

  • 4. 
    Super profit is
    • A. 

      Excess of average profit over normal profit

    • B. 

      Extra profit earned

    • C. 

      Average profit earned by similar companies

    • D. 

      None of the above

  • 5. 
    Normal profit is
    • A. 

      Average profit earned

    • B. 

      Profit earned by similar companies in the same industry

    • C. 

      (a) and (b)

    • D. 

      None of the above

  • 6. 
    Normal profit depends on
    • A. 

      Normal Rate of Return

    • B. 

      Average capital employed

    • C. 

      Both (a) and (b)

    • D. 

      None of the above

  • 7. 
    Goodwill as per purchase of average profit method
    • A. 

      Average Profit

    • B. 

      Average profit x Amount of purchases

    • C. 

      Average Profit x No. of years purchases

    • D. 

      All of the above

  • 8. 
    Goodwill as per purchase of super profit method is
    • A. 

      Super Profit

    • B. 

      Super Profit x amount of Purchases

    • C. 

      Super of Profit x No of year's Purchases

    • D. 

      None of the above

  • 9. 
    Normal Rate of Return depends on
    • A. 

      Rate of Interest

    • B. 

      Rate of Risk

    • C. 

      Both a & b

    • D. 

      None of the above

  • 10. 
    While both calculating capital employed
    • A. 

      Tangible trading assets should be considered

    • B. 

      Intangible assets should be considered

    • C. 

      Fictitious assets should be considered

    • D. 

      None of the above

  • 11. 
    Any non-trading income included in the profit should be
    • A. 

      Eliminated

    • B. 

      Added

    • C. 

      Ignored

    • D. 

      None of the above

  • 12. 
    Under capitalization profit method, Goodwill is equal to
    • A. 

      Capitalized Value of super profit at NRR

    • B. 

      Capitalized value of maintained profit

    • C. 

      Both a & b

    • D. 

      None of the Above

  • 13. 
    Capital employed at the end of the year is 4, 20,000. Profit earned is 40.000. Average capital employed is
    • A. 

      4,20,000

    • B. 

      4,00,000

    • C. 

      4,40,000

    • D. 

      4,60,000

  • 14. 
    Rate of interest is 11 % and the rate of risk is 9 %. The normal rate of return is
    • A. 

      11 %

    • B. 

      19 %

    • C. 

      20 %

    • D. 

      2 %

  • 15. 
    Capital at the beginning of the year is 5,20,000 and the profit earned during the year is 60,000. The average capital employed year is
    • A. 

      5,50,000

    • B. 

      5,20,000

    • C. 

      5,80,000

    • D. 

      4,60,000

  • 16. 
    The average Profit is 19,167 and the normal profit is 10,000. The Super Profit is
    • A. 

      3,29,167

    • B. 

      19,167

    • C. 

      10,000

    • D. 

      9,167

  • 17. 
    Super Profit is Rs 9,167 and the Normal Rate of Return is 10 % Goodwill as per capitalization of the Super Profit method is equal to
    • A. 

      67,910

    • B. 

      91,670

    • C. 

      90,600

    • D. 

      95,000

  • 18. 
    Which of the following statement is true
    • A. 

      Fair value is the yield value

    • B. 

      Fair value is the average of intrinsic and yield value

    • C. 

      Both A& B

    • D. 

      None of the above

  • 19. 
    Shares are to be valued on
    • A. 

      Mergers

    • B. 

      Sale of shares

    • C. 

      Gift tax

    • D. 

      All of the above

  • 20. 
    Quoted shares are those shares which are
    • A. 

      Listed on the stock exchange

    • B. 

      Quoted daily

    • C. 

      Quoted by the seller

    • D. 

      Quoted by the buyer

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