can u explain Good will calculation methods?
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Answer Posted / kaushal jha.
Goodwill is calculated by 3 method:-
1) Average profit method: In this method We calculate
goodwill as follow- Total Profit
-------------- * No.of Purchasing year
No. of year
2)Super profit Method:- Average Profit - Normal Profit =
Super Profit and Multiply(*) No. of purchasing Year.
3) Capitalisation Method :- In this method first we find
Average Profit and multiply it Normal rate of return.
| Is This Answer Correct ? | 53 Yes | 10 No |
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