Accountancy, asked by shristisharma037, 2 months ago

7. A partnership firm earned net profits during the last five years as follows:idents
1st Year—240,000; 2nd Year—50,000; 3rd Year255,000; 4th Year 70,000;5th Year-185,000
The capital investment of the firm is 5,00,000. A fair return on the capital having regard to the
risk involved is 10%. Calculate the value of goodwill on the basis of 3 years purchase of average
super profits earned during the above mentioned period.
(N.C.E.R.T.)
[Ans. Goodwill * 30,000.)​

Answers

Answered by Sauron
95

Answer:

Goodwill of the firm = Rs. 3,30,000

Explanation:

Given:

Profit of firm :

The Profit for the last five years of a firm :

Year ———— Profit (Rs.)

1st Year ———2,40,000

2nd Year ——— 50,000

3rd Year ———2,55,000

4th Year ———— 70,000

5th Year ——— 1,85,000

To find :

Calculate Goodwill of the firm

Solution :

Goodwill = Super Profit × number of year purchased

★ Average Profit =

\sf{\longrightarrow{\dfrac{Total \: Profits \: for \: past \: Given \: years}{Number \: of \: years}}}

\sf{\longrightarrow{\dfrac{2,40,000 \: + \:50,000 \: + \: 2,55,000 \: + \:70,000\: +\:1,85,000}{5}}}

Average Profit = 1,60,000

Normal Profit = Capital Employed × Rate of return / 100

Normal Profit = 5,00,000 × 10 / 100

Normal Profit = 50,000

Super Profit = Average profit - Normal Profit

Super Profit = 1,60,000 - 50,000

Super Profit = 1,10,000

Goodwill = Super Profit × Number of year purchased

Goodwill = 1,10,000 × 3

Goodwill = 3,30,000

∴ Goodwill of the firm = Rs. 3,30,000

Answered by Anonymous
108

Explanation:

Goodwill of the firm = Rs. 3,30,000

Explanation:

Given:

Profit of firm :

The Profit for the last five years of a firm :

Year ———— Profit (Rs.)

1st Year ———2,40,000

2nd Year ——— 50,000

3rd Year ———2,55,000

4th Year ———— 70,000

5th Year ——— 1,85,000

To find :

Calculate Goodwill of the firm

Solution :

Goodwill = Super Profit × number of year no purchased

★ Average Profit =

\sf{\longrightarrow{\dfrac{Total \: Profits \: for \: past \: Given \: years}{Number \: of \: years}}}⟶

Numberofyears

TotalProfitsforpastGivenyears

\sf{\longrightarrow{\dfrac{2,40,000 \: + \:50,000 \: + \: 2,55,000 \: + \:70,000\: +\:1,85,000}{5}}}⟶

5

2,40,000+50,000+2,55,000+70,000+1,85,000

Average Profit = 1,60,000

Normal Profit = Capital Employed × Rate of return / 100

Normal Profit = 5,00,000 × 10 / 100

Normal Profit = 50,000

Super Profit = Average profit - Normal Profit

Super Profit = 1,60,000 - 50,000

Super Profit = 1,10,000

Goodwill = Super Profit × Number of year purchased

Goodwill = 1,10,000 × 3

Goodwill = 3,30,000

∴ Goodwill of the firm = Rs. 3,30,000

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