Given: N N Capital 200,000 total assets 210,000 Liabilities 10,000 210,000 210,000 If the business is purchased at a price including a goodwill of ₦20,000, ...

Assessment: JAMB UTME - Principles of Accounts - 2001 Subject: Financial Accounting

Question 1 Report

Given:

N N

Capital 200,000 total assets 210,000

Liabilities 10,000

210,000 210,000

If the business is purchased at a price including a goodwill of ₦20,000, what must have been the purchas price?

Answer Details
The total assets of the business including goodwill will be equal to the purchase price. Therefore, the purchase price can be calculated by adding the total assets to the goodwill: Purchase price = Total assets + Goodwill Purchase price = ₦210,000 + ₦20,000 Purchase price = ₦230,000 Therefore, the purchase price including goodwill would be ₦230,000.

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