1.

Divya purchased Jyoti's business with effect from 1st April, 2019. Profits shown by Jyoti's business for the last three ​financial years were: 2016-17 : ₹ 1,00,000 (including an abnormal gain of ₹ 12,500). 2017-18 : ₹ 1,25,000 (after charging an abnormal loss of ₹ 25,000). 2018-19 : ₹ 1,12,500 (excluding ₹ 12,500 as insurance premium on firm's property- now to be insured). Calculate the value of firm's goodwill on the basis of two year's purchase of the average profit of the last three years.

Answer» Divya purchased Jyoti's business with effect from 1st April, 2019. Profits shown by Jyoti's business for the last three ​financial years were:


















2016-17 : ₹ 1,00,000 (including an abnormal gain of ₹ 12,500).
2017-18 : ₹ 1,25,000 (after charging an abnormal loss of ₹ 25,000).
2018-19 : ₹ 1,12,500 (excluding ₹ 12,500 as insurance premium on firm's property- now to be insured).


Calculate the value of firm's goodwill on the basis of two year's purchase of the average profit of the last three years.



Discussion

No Comment Found