Question No 16 of TS Grewal (CBSE)
Amit and Kartik are partners sharing profits and losses equally. They decided to admit Saurabh for an equal share in the profits. For this purpose, the goodwill of the firm was to be valued at four years’ purchase of super profits. The balance sheet of the firm on Saurabh’s admission was as follows:
Liabilities | Rs. | Assets | Rs. |
Amit’s Capital Karthik’s Capital Creditors General Reserve Bills Payable | 90,000 50,000 5,000 20,000 25,000 1,90,000 | Fixed Assets (Tangible) Furniture Stock Debtors Cash | 75,000 15,000 30,000 20,000 50,000 1,90,000 |
The normal rate of return is 12% p.a. Average profit of the firm for the last four years was Rs. 30,000. Calculate Saurabh’s Share of goodwill..
Solution No 16 of TS Grewal (CBSE)
