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Actual average profit Rs. 72,000, (ii) Normal rate of return 10%, (iii) Assets Rs. 9,70,000, (iv) Current Liabilities Rs. 4,00,000. Goodwill according to capitalization method will be A- Rs. 1,50,000 B- Rs. 5,70,000 C- Rs. 7,20,000 D- Rs. 25,000?
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Actual average profit Rs. 72,000, (ii) Normal rate of return 10%, (iii...
Calculation of Goodwill using Capitalization Method

Average Profit Calculation:
- Given Actual average profit = Rs. 72,000

Normal Rate of Return Calculation:
- Given Normal rate of return = 10%

Capitalization Calculation:
- Capitalization = Average Profit / Normal Rate of Return
- Capitalization = Rs. 72,000 / 10%
- Capitalization = Rs. 7,20,000

Calculation of Net Assets:
- Given Assets = Rs. 9,70,000
- Given Current Liabilities = Rs. 4,00,000
- Net Assets = Assets - Current Liabilities
- Net Assets = Rs. 5,70,000

Calculation of Goodwill:
- Goodwill = Capitalization - Net Assets
- Goodwill = Rs. 7,20,000 - Rs. 5,70,000
- Goodwill = Rs. 1,50,000

Therefore, the Goodwill according to the Capitalization Method is A- Rs. 1,50,000.
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Actual average profit Rs. 72,000, (ii) Normal rate of return 10%, (iii...
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Actual average profit Rs. 72,000, (ii) Normal rate of return 10%, (iii) Assets Rs. 9,70,000, (iv) Current Liabilities Rs. 4,00,000. Goodwill according to capitalization method will be A- Rs. 1,50,000 B- Rs. 5,70,000 C- Rs. 7,20,000 D- Rs. 25,000?
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Actual average profit Rs. 72,000, (ii) Normal rate of return 10%, (iii) Assets Rs. 9,70,000, (iv) Current Liabilities Rs. 4,00,000. Goodwill according to capitalization method will be A- Rs. 1,50,000 B- Rs. 5,70,000 C- Rs. 7,20,000 D- Rs. 25,000? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Actual average profit Rs. 72,000, (ii) Normal rate of return 10%, (iii) Assets Rs. 9,70,000, (iv) Current Liabilities Rs. 4,00,000. Goodwill according to capitalization method will be A- Rs. 1,50,000 B- Rs. 5,70,000 C- Rs. 7,20,000 D- Rs. 25,000? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Actual average profit Rs. 72,000, (ii) Normal rate of return 10%, (iii) Assets Rs. 9,70,000, (iv) Current Liabilities Rs. 4,00,000. Goodwill according to capitalization method will be A- Rs. 1,50,000 B- Rs. 5,70,000 C- Rs. 7,20,000 D- Rs. 25,000?.
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