Accounting Multiple Choice Question – 10 January 2021

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

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A business was purchased by a company for $1.5 million. The table shows an extract from the 

Balance Sheet of the business purchased. 

  1. fixed assets – £400,000
  2. net current assets – £120,000
  3. long-term loan – £200,000

If these values were agreed by the purchasing company, how much was paid for Goodwill? 

Select ONE answer:

  1. £520,000
  2. £780,000
  3. £980,000
  4. £1,180,000

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

  1. Not correct
  2. Not correct
  3. Not correct
  4. Correct – £400K + £120K – £200K = £320k – £1,500k ===> £1,180k

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