The average net profit of a business as adjusted for valuation of goodwill amounted to ₹2,35,000. The net tangible assets employed were of the value of ₹14,50,000. But upon valuation, they amounted to ₹15,00,000. Assumin

CS Executive · Company Accounts & Auditing Practices · PYQS · June 2014
The average net profit of a business as adjusted for valuation of goodwill amounted to ₹2,35,000. The net tangible assets employed were of the value of ₹14,50,000. But upon valuation, they amounted to ₹15,00,000. Assuming that 10% represented a fair commercial return, calculate the amount of goodwill by capitalising super profits.

Topics: Company Accounts

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