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How is abnormal loss treated before calculating average profit for goodwill valuation?

Answer and explanation

Correct answer: Added back to profit

Abnormal loss is not part of regular business profit so it is added back. Separate normal and abnormal items in exams.

Related tags

Abnormal LossAverage ProfitAdjustmentGoodwill AccountingReconstitution Admission Of A PartnerAccountancyClass 12 Mcq

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