The profits of firm for the five years are as follows:YearProfit(Rs.)2012-1320,0002013-1424,0002014-1530.0002015-1625.0002016–178,000Calculate the value of goodwill on the basis of three years' purchase ofweighted average profits based on weights 1,2,3,4 and 5 respectively.

Introduction:- Goodwill is an intangible asset. It arises when another company acquires a new…

The profits of firm for the five years are as follows: Year Profit (Rs.) 2012-13 20.000 2013-14 24.000 2014-15 30,000 2015-16 25.000 2016–17 18,000 Calculate the value of goodwill on the basis of three years' purchas weighted average profits based on weights 1.2,3,4 and 5 respectively.

The profits of firm for the five years are as follows: Year Profit (Rs.) 2012-13 20.000 2013-14 24.000 2014-15 30,000 2015-16 25.000 2016–17 18,000 Calculate the value of goodwill on the basis of three years' purchas weighted average profits based on weights 1.2,3,4 and 5 respectively.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

The profits of firm for the five years are as follows:
Year
Profit
(Rs.)
2012-13
20,000
2013-14
24,000
2014-15
30.000
2015-16
25.000
2016–17
8,000
Calculate the value of goodwill on the basis of three years' purchase of
weighted average profits based on weights 1,2,3,4 and 5 respectively.

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