Question

Miscellaneous and Boards' Questions
20. A partnership firm earned net profits during the last four years as follows:
1st year * 20,000; 2nd year 22.000; 3rd year 28,000; 4th year 34,000.
The capital investment of the firm is 1,20,000. A fair return on the capital having room
risk involved is 10%, Caleulate the value of the goodwill on the basis of 3 years per
average super profits earned during the above mentioned period,
(USEBI​

Answer 1

Answer:

✍✍Goodwill:42000

Explanation:

Average Profit:20000+22000+28000+34000/4=26000

Normal Profit:120000×10%=12000

Super Profit:26000-12000=14000

Goodwill:14000×3=42000