Accountancy Tes...

Directions: Read the following case study and answer questions on the basis of the same.

Tony and Rony started a partnership firm, TR CDs to manufacture music CDs way back in 1990. Now since the music CDs are out of business, they plan to sell the business to one of the major content production houses in Mumbai. For the purpose of selling business, they reached to their accountant to calculate the goodwill and other financial advice. He suggested that since the CDs are very less in demand, their goodwill value will be hampered. Nonetheless, the framework for goodwill calculation was decided as follows

‘The goodwill be valued at 4 years’ purchase of super profits.’ The following financial information was obtained at the end of this transaction

• Assets ₹ 8,000

• Creditors ₹ 1,000

• Normal rate of return 10%

• Good will of the firm ₹1,000

Directions: Read the following case study and answer questions on the basis of the same.

Tony and Rony started a partnership firm, TR CDs to manufacture music CDs way back in 1990. Now since the music CDs are out of business, they plan to sell the business to one of the major content production houses in Mumbai. For the purpose of selling business, they reached to their accountant to calculate the goodwill and other financial advice. He suggested that since the CDs are very less in demand, their goodwill value will be hampered. Nonetheless, the framework for goodwill calculation was decided as follows

‘The goodwill be valued at 4 years’ purchase of super profits.’ The following financial information was obtained at the end of this transaction

• Assets ₹ 8,000

• Creditors ₹ 1,000

• Normal rate of return 10%

• Good will of the firm ₹1,000

Directions: Read the following case study and answer questions on the basis of the same.

Tony and Rony started a partnership firm, TR CDs to manufacture music CDs way back in 1990. Now since the music CDs are out of business, they plan to sell the business to one of the major content production houses in Mumbai. For the purpose of selling business, they reached to their accountant to calculate the goodwill and other financial advice. He suggested that since the CDs are very less in demand, their goodwill value will be hampered. Nonetheless, the framework for goodwill calculation was decided as follows

‘The goodwill be valued at 4 years’ purchase of super profits.’ The following financial information was obtained at the end of this transaction

• Assets ₹ 8,000

• Creditors ₹ 1,000

• Normal rate of return 10%

• Good will of the firm ₹1,000

Directions: Read the following case study and answer questions on the basis of the same.

Tony and Rony started a partnership firm, TR CDs to manufacture music CDs way back in 1990. Now since the music CDs are out of business, they plan to sell the business to one of the major content production houses in Mumbai. For the purpose of selling business, they reached to their accountant to calculate the goodwill and other financial advice. He suggested that since the CDs are very less in demand, their goodwill value will be hampered. Nonetheless, the framework for goodwill calculation was decided as follows

‘The goodwill be valued at 4 years’ purchase of super profits.’ The following financial information was obtained at the end of this transaction

• Assets ₹ 8,000

• Creditors ₹ 1,000

• Normal rate of return 10%

• Good will of the firm ₹1,000

Directions: Read the following case study and answer questions on the basis of the same.

Sam and Tom decided to set up a partnership to sell low-sodium, plant-based vegan snacks. Since both had families, they decided to withdraw a salary of ₹12,000 per quarter. Sam also withdrew ₹1,00,000 on 31st December 2020 to get her wife treated for COVID-19. The partnership deed provided for 10% p.a. interest on drawings. Tom introduced ₹50,000 as additional capital on 31st January 2021 to increase the inventory. The net distributable profit was ₹2,00,000, which was divided between Sam and Tom after providing 25% to the general reserve.

Directions: Read the following case study and answer questions on the basis of the same.

Sam and Tom decided to set up a partnership to sell low-sodium, plant-based vegan snacks. Since both had families, they decided to withdraw a salary of ₹12,000 per quarter. Sam also withdrew ₹1,00,000 on 31st December 2020 to get her wife treated for Covid-19. The partnership deed provided for 10% p.a. interest on drawings. Tom introduced ₹50,000 as additional capital on 31st January 2021 to increase the inventory. The net distributable profit was ₹2,00,000, which was divided between Sam and Tom after providing 25% to the general reserve

Directions: Read the following case study and answer questions on the basis of the same.

Sam and Tom decided to set up a partnership to sell low-sodium, plant-based vegan snacks. Since both had families, they decided to withdraw a salary of ₹12,000 per quarter. Sam also withdrew ₹1,00,000 on 31st December 2020 to get her wife treated for Covid-19. The partnership deed provided for 10% p.a. interest on drawings. Tom introduced ₹50,000 as additional capital on 31st January 2021 to increase the inventory. The net distributable profit was ₹2,00,000, which was divided between Sam and Tom after providing 25% to the general reserve.

Directions: Read the following case study and answer questions on the basis of the same.

Sam and Tom decided to set up a partnership to sell low-sodium, plant-based vegan snacks. Since both had families, they decided to withdraw a salary of ₹12,000 per quarter. Sam also withdrew ₹1,00,000 on 31st December 2020 to get her wife treated for Covid-19. The partnership deed provided for 10% p.a. interest on drawings. Tom introduced ₹50,000 as additional capital on 31st January 2021 to increase the inventory. The net distributable profit was ₹2,00,000, which was divided between Sam and Tom after providing 25% to the general reserve.

Directions: Read the following case study and answer questions on the basis of the same.

Sam and Tom decided to set up a partnership to sell low-sodium, plant-based vegan snacks. Since both had families, they decided to withdraw a salary of ₹12,000 per quarter. Sam also withdrew ₹1,00,000 on 31st December 2020 to get her wife treated for Covid-19. The partnership deed provided for 10% p.a. interest on drawings. Tom introduced ₹50,000 as additional capital on 31st January 2021 to increase the inventory. The net distributable profit was ₹2,00,000, which was divided between Sam and Tom after providing 25% to the general reserve.