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If super profit is rupees forty thousand and normal rate of return is twenty percent what is goodwill under capitalization of super profit method?

Answer and explanation

Correct answer: Rupees 200000

Goodwill is found by capitalizing super profit at the normal rate. Dividing rupees 40000 by twenty percent gives rupees 200000.

Related tags

GoodwillCapitalisation-Super-ProfitNumericalPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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