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Question
If average capital employed in a firm is ₹8,00,000, average of actual profits is ₹1,80,000 and normal rate of return is10%, then value of goodwill as per capitalization of average profits is ______.
Options
₹10,00,000
₹18,00,000
₹80,00,000
₹78,20,000
MCQ
Fill in the Blanks
Solution
If average capital employed in a firm is ₹8,00,000, average of actual profits is ₹1,80,000 and normal rate of return is10%, then value of goodwill as per capitalization of average profits is ₹10,00,000.
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Methods of Valuation of Goodwill
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