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Standard XII

Accountancy

Hidden Goodwill

A business ha...

Question

A business has following items:
Vehicles Rs 600,000,
Debtors Rs 1,20,000,
Cash Rs 30,000,
Owner's Equity Rs 10,00,000
Loan Rs 5,00,000,
Creditors Rs 50,000
Value of the land is ____________.

R s .1, 000, 000

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R s .1, 550, 000

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R s .8, 00, 000

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None of these

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Solution

The correct option is D $R s .8, 00, 000$
Total assets = Total liabilities
Total liabilities = Owner's equity + Loan + Creditor
Total liabilities = $R s .10, 00, 000$ + $R s .5, 00, 000$ + $R s .50, 000$
Total liabilities = $R s .15, 50, 000$
Hence, Total liabilities = $R s .15, 50, 000$
Total assets = Land + Vehicle + Debtors + Cash
$R s .15, 50, 000$ = Land + $R s .6, 00, 000$ + $R s .1, 20, 000$ + $R s .30, 000$
Therefore, Land = $R s .8, 00, 000$

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A business has following items:Vehicles Rs 600,000, Debtors Rs 1,20,000, Cash Rs 30,000, Owner's Equity Rs 10,00,000Loan Rs 5,00,000, Creditors Rs 50,000 Value of the land is ____________.

A business has following items:
Vehicles Rs 600,000,
Debtors Rs 1,20,000,
Cash Rs 30,000,
Owner's Equity Rs 10,00,000
Loan Rs 5,00,000,
Creditors Rs 50,000
Value of the land is ____________.