The average profit of a firm is 50,000 .Its assets and outside liabilities are 5,00,000 and 2,00,000 respectively. The normal rate of return is 10%. Find the value of goodwill if it is based on 2 years purchase of super profit.
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normal profit = 300000×10/100=30000
super profit =50000-30000=20000
goodwill =. 20000×2=40000
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