The godwill of a firm is estimated at two year purchase of the average profit are under
2017 -18 20000( including an abnormal gain of 5000)
2018-19 40000 (after changing abnormal loss of rupee 10000
2019-20 42000( excluding 2000as insurance premium of property now to be increased
calculate amount of godwill
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total adjusted profit= (20k-5k)+ (40k+10k)+( 42k-2k)
= 105k
average profit = 105k/3
= 35k
goodwill of the firm = 35k× 2
= ₹70000
hope this will help you.!
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