Question

A profits of last four year's Ashok and alok are ₹12,000 , 18,000 , 20,000and 10,000. You are required to calculate the value of goodwill based on three year's purchase of average profit of last four years.​

Answer 1

Answer:

average profit = (12,000 + 18,000 + 20,000 + 10,000) /4 = 60,000/4 = 15,000

goodwill = 15,000×3 = 45,000