Question

From the following information, you are required to calculate the value of Goodwill by Capitalization Method:

1) Capitalization of Actual Average Profit

 

2) Capitalization of Super Profit

 

a. Actual Average Profit Rs. 60,000

 

b. Normal Rate of Return 10%

 

c. Actual Capital Employed Rs. 4,50,000

 

20 Feb 2025
Answer :
Word Count : 93
  1. Capitalization of Actual Average Profit Method

    • Formula: Goodwill=(Actual Average Profit×100Normal Rate of Return)−Actual Capital Employed\text{Goodwill} = \left(\frac{\text{Actual Average Profit} \times 100}{\text{Normal Rate ____ _________ ______ ______ ____ __________ ____ ____ _____.
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      ___ _________ __________ __________ ________ _________ _________ ______ ____ _________ __________.
      _____ __________ _______ ______ _________ _______ _________.
      _____ ____ ___.
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