Assume it is expected that a firm can cash 10% profit on Invested Capital of 80000...

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Assume it is expected that a firm can cash 10% profit on Invested Capital of 80000 every year, while the average of profits for the last 4 years is Rs. 10000, according to the partnership deed, goodwill is valued at 3 year's purchase of the Super Profit. The amount of goodwill will be? Assume it is expected that a firm can cash 10% profit on Invested Capital of 80000 every year, while the average of profits for the last 4 years is Rs. 10000, according to the partnership deed, goodwill is valued at 3 year's purchase of the Super Profit. The amount of goodwill will be?

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There are four methods of calculating Goodwill 1 Average profit method 2 ... View the full answer