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Goodwill is affected by the following factors except: - Accounts

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Question

Goodwill is affected by the following factors except:

Options

  • Past Performance

  • Efficient Management

  • Technical Know-how

  • Location of the Customers

MCQ
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Solution

Location of the Customers

Explanation:

Goodwill is influenced by several key factors such as:

  • Past performance (consistent profits enhance goodwill),
  • Efficient management (better use of resources increases goodwill),
  • Technical know-how (superior processes and expertise give competitive edge).

However, location of the customers is not a recognised factor that directly affects goodwill. Instead, it is the location of the business itself that matters (e.g., being in a prime market area).

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Chapter 2: Goodwill : Concept and Valuation - OBJECTIVE TYPE QUESTIONS [Page 2.34]

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D. K. Goel Accountancy Volume 1 and 2 [English] Class 12 ISC
Chapter 2 Goodwill : Concept and Valuation
OBJECTIVE TYPE QUESTIONS | Q (B) 18. | Page 2.34
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