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Profits are (₹80000), (₹100000), (₹140000), (₹200000). There is a clear rising trend. Which method may be more suitable for goodwill valuation?

Answer and explanation

Correct answer: Weighted average profit method

In rising profits giving more importance to recent years may be appropriate. Therefore weighted average method is useful.

Related tags

GoodwillMethod SelectionWeighted AveragePartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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