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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Rajan and Rajani are partners in a firm. Their capitals were Rajan ₹3,00,000 and Rajani ₹2,00,000. During the year ended 31st March, 2025, the firm earned a profit of ₹1,50,000. Calculate the value of goodwill of the firm by the Capitalisation of Super Profit Method, assuming that the normal rate of return is 20%.
Normal Profit = Capital Employed × Normal Rate of Return = (₹3,00,000 + ₹2,00,000) × 20% = ₹1,00,000.
Super Profit = Average Profit – Normal Profit = ₹1,50,000 – ₹1,00,000 = ₹50,000.
Goodwill = Super Profit × 100 / Normal Rate of Return = ₹50,000 × 100 / 20 = ₹2,50,000.
Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
This guide covers "T.S. Grewal Class 12 Chapter 2 Q.35 - Nature and Valuation of Goodwill", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Chapter 2 - Nature and Valuation of Goodwill.
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