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A firm has earned profits of 20000 ,6000 ,12000 and 8000 respectively in the last four years. The capital invested in the firm is 50000 . The rate of return expected from capital invested is 15% p.a. Calculate the value of goodwill on the basis of 3 years purchase of super profit . |
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Answer» raja BROTHERS EARN an average profit of 30,000 with a capital of 2,00,000. the normal rate of RETURN in the business is 10%. using capitalisation of SUPER profit method,workout the value of the goodwill of the FIRM. |
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