Question

The average profit of the firm is rs. 48,000.
Assets = 800000
Liabilities = 500000

Average rate of return = 12%
Calculate goodwill from capitalisation of avg. Profit method and super profit method.​

Answer 1

Answer:

Capital Employed

= Assets - Liabilities

= 8,00,000 - 5,00,000

Capital employed = 3,00,000

Capitalized Average profit

= 48,000 × 100/12

= 4,00,000

Goodwill = 4,00,000 - 3,00,000

= 1,00,000

Super profit method

Assets - Liabilities = capital

8,00,000 - 5,00,000

= 3,00,000

Super profit = Average profit - Normal profit

Normal profit

= capital employed × NRR/100

= 3,00,000 × 12/100

= 36,000

= 48,000 -36,000

= 12,000

Goodwill = Super profit - 100/NRR

= 12,000 × 100/12

= 1,00,000

Answer 2

Answer:

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