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Firms total investment 400000 net profit of last 4 years 65000 50000 80000 70000 the return on net capital employed 12% find value of goodwill if it is based on 4 years purchase of average super profit |
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Answer» average PROFIT =super profit+average profit normal profit=capital enmployed X normalrate of return/100 400000x12/100=48000 average profit=65000+50000+80000+70000/4=66500 super average profit=average profit-normal profit super profit=66500-48000=18500 ANS |
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