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Class 12 Accountancy – Chapter 2 Goodwill Quick Revision Notes + PYQs

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  1. Goodwill is one of the most important topics in Class 12 Accounts. Here are short, exam‑oriented notes with keywords, methods, and PYQs for quick revision.

📘 Class 12 Accounts – Chapter 2: Goodwill

🌟 Meaning

👉 Goodwill = Reputation + Extra earning power

👉 Ek Intangible Asset hai (dikhai nahi deti but value hoti hai)

📝 Features

  • 🌐 Invisible but valuable
  • 💰 Firm ko super profit dilati hai
  • 📉 Value fix nahi hoti, time ke sath change hoti hai
  • 🏢 Sirf business ke sath transfer hoti hai

📌 Need for Valuation

  • 👥 New partner admission
  • 🚪 Retirement / Death of partner
  • 🔄 Profit-sharing ratio change
  • 🏷️ Sale of firm

🔑 Methods

1️⃣ Average Profit Method

👉 Goodwill = Avg Profit × Years’ Purchase

2️⃣ Super Profit Method

👉 Super Profit = Actual Profit – Normal Profit

👉 Goodwill = Super Profit × Years’ Purchase

3️⃣ Capitalisation Method

👉 Capitalised Value = (Avg Profit × 100) / Normal Rate of Return

👉 Goodwill = Capitalised Value – Actual Capital

📊 Exam Focus (Last 5 yrs)

✅ Super Profit Method (3–5 marks)

✅ Average Profit Method (3 marks)

✅ Capitalisation Method (5–6 marks)

✅ Short notes: Features + Need

🎯 Exam Tip

  • ⏳ Agar Q me “No. of Years’ Purchase” diya ho → Average / Super Profit Method
  • 📈 Agar Q me “Rate of Return” diya ho → Capitalisation Method

🧠 Memory Trick:

  • Years = Average / Super Profit
  • Return = Capitalisation

⚡ Quick Keywords

Reputation | Intangible | Super Profit | Normal Profit | Capitalisation | Years’ Purchase

📌 PYQs (Past Year Questions)

1️⃣ 2021 – Define Goodwill. State any two factors affecting its value. (2 marks)

2️⃣ 2020 – A firm earns an average profit of ₹50,000. Normal rate of return is 10%. Capital employed is ₹4,00,000. Calculate goodwill by Super Profit Method (Years’ Purchase = 3). (5 marks)

3️⃣ 2019 – Explain the need for valuation of goodwill at the time of admission of a partner. (3 marks)

4️⃣ 2018 – A firm’s average profit is ₹60,000. Normal profit is ₹45,000. Calculate goodwill using Super Profit Method (Years’ Purchase = 4). (4 marks)

5️⃣ 2017 – State any three features of goodwill. (3 marks)