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CBSE Class 12-commerce Answered

the goodwill of a firm is estimated at two year purchase of the average profit of the last 5 year . if  goodwill of the firm is determined at 1,24,200 and profit or losses of last 4 year is given as; year                     profit 2010                      ? 2011                    40,000(loss) 2012                    92,000 2013                    70,000 2014                    55,000  CALCULATE PROFIT OR LOSS EARNED  BY THE FIRM IN THE YEAR 2010
Asked by vishalainghkvs | 12 Feb, 2019, 09:53: AM
answered-by-expert Expert Answer
Let profit for the year 2010 be Rs.k
Using simple average method of Goodwill:
Goodwill = Avereage of last 5years * No. of years of purchase
 
Substituiting the values given,
124200 = (k-40000+92000+70000+55000)/5 * 2
124200/2 * 5 = k+177000
310500 = k + 177000
k = 133500
 
Therefore, Profit for the year 2010 is 133500.
Answered by Surabhi Gawade | 12 Feb, 2019, 10:14: AM

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