hello tutor please help me Goodwill of a firm is to be valued at two years'purchase of three years' average profits. Theprofits of the last three years were: 2000 - RO.30,000, 2001 - RO. 40,000 and 2002 - RO. 35,000.Calculate the amount of goodwill.

Step 1: Definition of GoodwillGoodwill is an intangible asset representing the value of a firm's…

Answered: Goodwill of a firm is to be valued at…

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter7: Fixed Assets, Natural Resources, And Intangible Assets

Section: Chapter Questions

Problem 7.3.3MBA

See similar textbooks

Similar questions

The following details relate to M/s XYZ, a firm: Average profit of last four years = $7,00,000 Average capital employed by the firm: $55,00,000 Normal rate of return :10% Present value of annuity of $1 for 4 years @ 10% : 3.1699 Determine the value of goodwill on the basis of annuity of super profit.
Tyson & Co. values its goodwill at three years' purchase of the last four years' average profit. The recorded profits for the last four years were R.O 50,000, R.O 28,000, R.O 18,000, and R.O 14,000, respectively. Find out the value of goodwill.need answer
Tyson & Co. values its goodwill at three years' purchase of the last four years' average profit. The recorded profits for the last four years were R.O 50,000, R.O 28,000, R.O 18,000, and R.O 14,000, respectively. Find out the value of goodwill.
Find out the value of goodwill
Calculate the goodwill of the firm
The asset - vehicle worth £21,200 will be depreciated by 10% at the end of the year. Which nominal accounts should be debited and credited, respectively? a) Debit Depreciation A/c & Credit Non-Current Asset A/c b) Debit Inventory A/c & Credit Depreciation A/c c) Debit Balance Sheet A/c & Credit Profit or Loss A/c
using a capitalization of 10% a commercial property is valued at 420000. the expenses are 30% of the gross income. what is the monthly gross incom
shobha
Beyer Company's is considering the purchase of an asset for $205,000. It is expected to produce the following net cash flows. The cash flows occur evenly within each year. Assume that Beyer requires a 12% return on invetsments. (PV of $1, FV of $1, PVA of $1, and FVA of $1. Net cash flows (Year 1 $70,000, Year 2 $50,000. Year 3 $88,000, Year 4 $159,000 and Year 5 $53,000. A. Compute the net present value of this investment B. Should Beyer accept the investment?
Consider an asset with upfront cost of $32,639. The cost associated with it during the first year of operation is $3,415. The cost associated with it during the second year of operation is $12,099. With an interest rate of 0.08, what is a levelized cost payment payable at the end of years 1 and 2, which has the same present value as the actual cost stream at the end of period 0. The annuity formula for an interest rate of 0.08 and t payments is given by 0+ 2)-(¹-0)
An investment with an original value of $11 000 is sold for proceeds of $12950.00. If the investment yield was 5% compounded semi-annually, for howmany years was the money invested?
We know the following data of an investment that the company has made: An initial disbursement of €2,000,000 and generates the collections and payments in the successive years of its duration that are shown in the following table: Years Collections € Payments € 1 4,500,000 3,800,000 2 5,500,000 4,500,000 3 6,000,000 5,000,000 4 4,000,000 3,200,000 Calculate the IRR of the previous project. Justify for what type of discount this investment will be made.

SEE MORE QUESTIONS

Recommended textbooks for you

Survey of Accounting (Accounting I)

Accounting

ISBN:

9781305961883

Author:

Carl Warren

Publisher:

Cengage Learning

Survey of Accounting (Accounting I)

Accounting

ISBN:

9781305961883

Author:

Carl Warren

Publisher:

Cengage Learning

SEE MORE TEXTBOOKS

Goodwill of a firm is to be valued at two years' purchase of three years' average profits. The profits of the last three years were: 2000 - RO. 30,000, 2001 - RO. 40,000 and 2002 - RO. 35,000. Calculate the amount of goodwill.