Ques-17 The average net profits expected in the future by ABC firm are Rs. 1,00,000 per
year. The average capital employed in the business by the firm is 5,00,000. The rate of
interest expected from capital invested in this class of business is 15%. The
remuneration of the Partners is estimated to be Rs. 10,000 per annuam. Find out the
value of Goodwill on the basis of two years Purchase of super profits.
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Answer:
average profit = 1,00,000
Normal profit = capital employed × rate of return
= 5,00,000×15/100
= 75,000
actual average profit = 1,00,000-10, 000(remuneration)
= 90,000
super profit = 90,000-75, 000
= 15,000
goodwill = super profit × no of year purchase
= 15,000 × 2
= 30,000
goodwill = 30,000
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