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The goodwill of a firm is valued at 4 year’s purchase of average profits of last five years. The profits of the last five years were:

Year Profit (₹)
2018-19 2,00,000
2019-20 (3,00,000)
2020-21 4,50,000 (including an abnormal gain of ₹ 50,000)
2021-22 3,50,000 (after charging an abnormal loss of ₹ 90,000)
2022-23 2,60,000

Calculate the amount of goodwill

[Ans. Goodwill ₹ 8,00,000.]

Anurag Pathak Answered question June 27, 2024
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