Question

22, From the information given below, Galaxlare the value of goodwill of a firm Amand and shot by
Taking the ser profir being average of duree years Simple and weighted
(a) Net profits of the firm for the past nee years wene? 2.72.100, 3.22.800 and 3.37.500
(b) Fair remuneration of each partner for their service lis 18.000 per ammum mot charged to PLAT
( No. of purchase of years 1.5​

Answer 1

Goodwill = Rs. 10,34,100

Explanation:

I) Average profits :

Total profits

Number of years profits

= 2,72,100 + 3,22,800 + 3,37,500

3

= 9,32,400

3

= Rs. 7,07, 400

(-) Remuneration 18000

Net Avg profits. - 6,89,400

2) Goodwill = Avg profits X No.of years of purchase

= 6,89,400 x 1.5

= Rs. 10,34,100