Question

refer and earn profit of rupees 20000 rupees 6000 rupees 12000 rupees 8000 during the past 4 years the firm has capital invested of rupees 50000 a fair return on investment is 15% per annum calculate Goodwill of the firm based on three year purchase of average super profit​

Answer 1

Answer:

average profit = 20000+6000+12000+8000/4

= 46000/4= 11500

normal profit = 50000*15/100=7500

super profit = average profit -normal profit

= 11500-7500

=4000

goodwill = super profit *no. of year purchase

= 4000*3=12000