Question

Calculate goodwill by Capitalisation of Super profits method, when Average Profits is Rs. 72,000, Normal rate of return is 10%,  Assets is Rs. 9,70,000 & liabilities is Rs. 4,00,000​

Answer 1

Answer:

150000

Explanation:

First we have to calculate capital employed

capital employed=assets-liabilities

=970000-400000

=570000

Now calculate normal profit

normal profit=capital employed×NRR/100

=570000×10/100

=57000

Now calculate super profit

super profit=average profit-normal profit

=72000-57000

=15000

value of goodwill by capitalization of super profit method=super profit×100/NRR

=15000×100/10

=150000

Hope my would be correct...