Calculate the value of Goodwill at three years purchase of an average profit of five years. Profit and Loss for last five years are Answer... MP Board Class-12 BOOK KEEPING AND ACCOUNTANCY question answer collection

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Que : 83. Calculate the value of Goodwill at three years purchase of an average profit of five years. Profit and Loss for last five years are as follow – 2014 Profit Rs. 20,000. 2015 Profit Rs. 15.000, 2016 Loss Rs. 13,000, 2017 Profit Rs. 30.000 and 2018 Profit Rs. 38,000.
Answer: average profit = 20,000+15,000-13,000+30,000+38,000 / 5 = 18000 goodwill = 18000 * 3 = 54000

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