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The firm A,B,and C has existed for the last 5 years partners decide to raise goodwill account in the their books at the twice the average of the last 5 years profit .The profit of the last 5 year's are as under. Years Rupes. Years Rupes 1. 20000. 4 5000 2. 15000. 5. 10000 3. 5000 Calculate the goodwill?
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The firm A,B,and C has existed for the last 5 years partners decide to...
Calculating Goodwill for A, B, and C Partnership
Introduction:
In this question, we are required to calculate the goodwill of the A, B, and C partnership firm. The partners have decided to raise the goodwill account in their books at twice the average of the last 5 years' profit.
Given Information:
- A, B, and C partnership firm has existed for the last 5 years.
- The partners have decided to raise the goodwill account at twice the average of the last 5 years' profit.
- The profit of the last 5 years are as follows:
Year 1: Rs. 20,000
Year 2: Rs. 15,000
Year 3: Rs. 5,000
Year 4: Rs. 5,000
Year 5: Rs. 10,000
Calculation:
Step 1: Calculate the total profit of the last 5 years.
Total profit = Rs. 20,000 + Rs. 15,000 + Rs. 5,000 + Rs. 5,000 + Rs. 10,000
Total profit = Rs. 55,000
Step 2: Calculate the average profit of the last 5 years.
Average profit = Total profit / Number of years
Average profit = Rs. 55,000 / 5
Average profit = Rs. 11,000
Step 3: Calculate the goodwill.
Goodwill = Average profit x 2
Goodwill = Rs. 11,000 x 2
Goodwill = Rs. 22,000
Conclusion:
Therefore, the goodwill of the A, B, and C partnership firm is Rs. 22,000. The partners have decided to raise the goodwill account at twice the average of the last 5 years' profit. This means that they have valued the firm's reputation, customer base, and other intangible assets at Rs. 22,000. This value will be recorded in their books and will be used to calculate the firm's net worth.
Introduction:
In this question, we are required to calculate the goodwill of the A, B, and C partnership firm. The partners have decided to raise the goodwill account in their books at twice the average of the last 5 years' profit.
Given Information:
- A, B, and C partnership firm has existed for the last 5 years.
- The partners have decided to raise the goodwill account at twice the average of the last 5 years' profit.
- The profit of the last 5 years are as follows:
Year 1: Rs. 20,000
Year 2: Rs. 15,000
Year 3: Rs. 5,000
Year 4: Rs. 5,000
Year 5: Rs. 10,000
Calculation:
Step 1: Calculate the total profit of the last 5 years.
Total profit = Rs. 20,000 + Rs. 15,000 + Rs. 5,000 + Rs. 5,000 + Rs. 10,000
Total profit = Rs. 55,000
Step 2: Calculate the average profit of the last 5 years.
Average profit = Total profit / Number of years
Average profit = Rs. 55,000 / 5
Average profit = Rs. 11,000
Step 3: Calculate the goodwill.
Goodwill = Average profit x 2
Goodwill = Rs. 11,000 x 2
Goodwill = Rs. 22,000
Conclusion:
Therefore, the goodwill of the A, B, and C partnership firm is Rs. 22,000. The partners have decided to raise the goodwill account at twice the average of the last 5 years' profit. This means that they have valued the firm's reputation, customer base, and other intangible assets at Rs. 22,000. This value will be recorded in their books and will be used to calculate the firm's net worth.
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The firm A,B,and C has existed for the last 5 years partners decide to raise goodwill account in the their books at the twice the average of the last 5 years profit .The profit of the last 5 year's are as under. Years Rupes. Years Rupes 1. 20000. 4 5000 2. 15000. 5. 10000 3. 5000 Calculate the goodwill?
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The firm A,B,and C has existed for the last 5 years partners decide to raise goodwill account in the their books at the twice the average of the last 5 years profit .The profit of the last 5 year's are as under. Years Rupes. Years Rupes 1. 20000. 4 5000 2. 15000. 5. 10000 3. 5000 Calculate the goodwill? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about The firm A,B,and C has existed for the last 5 years partners decide to raise goodwill account in the their books at the twice the average of the last 5 years profit .The profit of the last 5 year's are as under. Years Rupes. Years Rupes 1. 20000. 4 5000 2. 15000. 5. 10000 3. 5000 Calculate the goodwill? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The firm A,B,and C has existed for the last 5 years partners decide to raise goodwill account in the their books at the twice the average of the last 5 years profit .The profit of the last 5 year's are as under. Years Rupes. Years Rupes 1. 20000. 4 5000 2. 15000. 5. 10000 3. 5000 Calculate the goodwill?.
The firm A,B,and C has existed for the last 5 years partners decide to raise goodwill account in the their books at the twice the average of the last 5 years profit .The profit of the last 5 year's are as under. Years Rupes. Years Rupes 1. 20000. 4 5000 2. 15000. 5. 10000 3. 5000 Calculate the goodwill? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about The firm A,B,and C has existed for the last 5 years partners decide to raise goodwill account in the their books at the twice the average of the last 5 years profit .The profit of the last 5 year's are as under. Years Rupes. Years Rupes 1. 20000. 4 5000 2. 15000. 5. 10000 3. 5000 Calculate the goodwill? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The firm A,B,and C has existed for the last 5 years partners decide to raise goodwill account in the their books at the twice the average of the last 5 years profit .The profit of the last 5 year's are as under. Years Rupes. Years Rupes 1. 20000. 4 5000 2. 15000. 5. 10000 3. 5000 Calculate the goodwill?.
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