The average profit earned by a firm is ₹ 1,00,000 which includes an undervaluation of stock of ₹ 40,000 on an average basis.

The capital invested in the business is ₹ 6,30,000 and the normal rate of return is 5%

Calculate the goodwill of the firm on the basis of 5 times the super profit.

[Ans.: Goodwill – ₹ 5,42,500]

Anurag Pathak Changed status to publish April 18, 2023
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