Goodwill is to be valued at three years' purchase of four years' average profit. Profits for last four years ending on 31st March of the firm were:
2016 - Rs. 12,000, 2017 - Rs. 18,000, 2018 - Rs. 16,000, 2019 - Rs. 14,000.
Calculate ammount of Goodwill.

A and B have been carrying on business in partneship with fixed capitals of Rs. 2,40,000 and Rs. 1,20,000 respectively and sharing profits in the same proportion. They decided that with effect from from April 1, 2016 they would share profits and losses in the ratio of 3 : 2. For this purpose goodwill is to be valued at three year's purchase of the average of precending three year's profits. The profits for the years ending 31st March were 2013 : Rs. 75,000, 2014 : Rs. 60,000, 2015 Rs. 80,000 and 2016 Rs. 1,30,000. Give the necessary journal entry.

Calculate goodwill of a firm on the basis of three Years' purchase of the Weighted Average Profit of the last four years. The porfits of the last four financial years ended 31st March, were: 2016 - Rs. 25,000, 2017 - Rs. 27,000, 2018 - Rs. 46,900 and 2019 - Rs. 53,810. The weights assigned to each year are: 2016 - 1, 2017 - 2, 2018 - 3, 2019 - 4. You are supplied the following information: (i) On 1st April, 2016, a major plant repair was undertaken for Rs. 10,000 which was charged to revenue. The said sum is to be capitalised for goodwill calculation subject to adjustment of depreciation of 10% on Reducing Balance Method. (ii) The Closing Stock for the years ended 31st March, 2017 and 2018 were overvalued by Rs. 1,000 and Rs. 2,000 respectively. (iii) To cover management cost an annual charge of Rs. 5,000 should be made for the purpose of goodwill valuation.

A and B are partners sharing profits and losses in the ratio of 3 : 1. It was decided that with effect from 1st April, 2015 the profit sharing ratio will be 5 : 3, Goodwill is to be val ued at 2 year's purchase of average of 3 year's profits. The profits for the years ending 31st March 2013, 2014 and 2015 were Rs. 36,000, Rs. 32,000 and Rs. 40,000 respectively. Pass necessary journal entry for the treatment of goodwill.

From the following particulars, calculate value of goodwill of a firm by applying Capitalisation of Average Profit Mehod: (i) Profits of last five consecutive years ending 31st March are: 2019 - Rs. 54,000, 2018 - Rs. 42,000, 2017 - Rs. 39,000, 2016 - Rs. 67,000 and 2015 - Rs. 59,000. (ii) Capitalisation rate 20% . (iii) Net assets of the firm Rs. 2,00,000.

Mohan and Sohan were partners in a firm sharing profits and losses in the ratio of 3 : 2. They admitted Ram for 1/4th share on 1st April, 2019. It was agreed that goodwill of the will be valued at 3 year's purchase of the average profit of last 4 years ended 31st March, were RS.50,000 for 2015-16, RS.60,000 for 2016-17, RS.90,000 for 2017-18 and RS.70,000 for 2018-19. Ram did and not bring his share of goodwill premium in cash. Record the necessary Journal entries in the books of the firm on Ram's admission when: (a) Goodwill appears in the books at RS.2,02,500. (b) Goodwill appears in the books at RS.2,500. (c) Good will appears in the books at RS.2,05,000.

Calculate the value of goodwill as on 1st April, 2015, on the basis of 2(1)/(2) year's purchase of the average profits of the last five years. The profits and losses for the years ending 31st March were : 2010 Rs. 80,000, 2011 Rs. 1,00,000, 2012 Loss Rs. 30,000, 2013 Rs. 1,70,000, 2014 Rs. 1,60,000 and 2015 Rs. 1,80,000. You are informed that the profits of the year ending 31st March 2014 included profit on sale of a fixed asset amounting to Rs. 50,000 and the profits for the year 2015 were effected by a loss due to fire amounting to Rs. 20,000.

A, B and C were partners sharing profits and losses in the ratio of 7 : 3 : 2. From 1st April 2015, they decided to share profits and losses in the ratio of 8 : 4 : 3. Goodwill is to be valued at the average of three year's profits preceding the date of change in profit sharing ratio. The profits for the years ending 31st March 2012, 2013, 2014 and 2015 were Rs. 52,000, Rs. 48,000, Rs. 60,000 and Rs. 90,000 respectively. Give the necessary journal entry.

Bharat and Bhushan are partners sharing profits in the ration of 3:2 . They decided to amit Manu as a partner from 1st April, 2019 on the following terms: (i) Manu will be given 2/5th share of the profit. (ii) Goodwill of the firm will be valued at two years' purchase of three years' normal average profit of the firm. Profits of the previous three years ended 31st March, were: 2019 - Profit Rs. 30,000 (after debiting loss of stock by fire Rs. 40,000). 2018 - Loss Rs. 80,000 (Includes voluntary retirement compensation paid Rs. 1,10,000). 2017 - Profit Rs. 1,10,000 (Including a gain (profit) of Rs. 30,000 on the sale of fixed assets). Calculate the value of goodwill .

(Average Profit Method when Adjustments are Made). Aman purchased Bharatendu's business with effect from 1st April, 2019. It was agreed that the firm's goodwill will be valued at two years' purchase of average normal profit of the lst three years. Profits of Bharatendu's business for last three years ended 31st March, were: 2017 : Rs. 1,00,000 (including an abnormal gain of Rs. 10,000), 2018 : Rs. 1,10,000 (after charging an abnormal loss of Rs. 20,000), 2019 : Rs. 85,000 (including interest of Rs. 5,000 from non-trade investment). Calculate value of the firm's goodwill.