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