Question 15 Chapter 3 – Unimax Class 12 Part 1
15. On 1st April, 2021 an existing firm has assets of Rs. 80000 including cash of Rs. 5000. The Partner’s Capital accounts showed a balance of Rs. 60000 and reserves constituted the rest. If the normal rate of return is 20% and the goodwill of the firm is valued at Rs. 24000 at 4 years purchase of super profits, find the average profits of the firm.
The solution of Question 15 Chapter 3 – Unimax Class 12 Part 1:
Goodwill = Rs. 24000 (given)
Or Goodwill = Super Profits X No. of years of purchase of super profits
Rs. 24000 = Super Profits X 4
Super Profits =Rs. 24000/4= Rs. 6000
Capital employed = Net Assets = Rs. 80000
Normal Profits = Capital employed X Normal rate of return
= Rs. 80000 X 20/100
= Rs. 16000
Super Profits = Average Profits – Normal Profits
Rs.6000 = Average Profits – Rs. 16000
So, Average Profits = Rs. 22000
What is Partnership – Meaning and Its 4 Types
T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)
- Chapter No. 1 – Financial Statement of Not-For-Profit Organisations
- Chapter No. 2 – Accounting for Partnership Firms – Fundamentals
- Chapter No. 3 – Goodwill: Nature and Valuation
- Chapter No. 4 – Change in Profit-Sharing Ratio Among the Existing Partners
- Chapter No. 5 – Admission of a Partner
- Chapter No. 6 – Retirement/Death of a Partner
- Chapter No. 7 – Dissolution of a Partnership Firm
T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)
- Chapter No. 8 – Company Accounts – Accounting for Share Capital
- Chapter No. 9 – Company Accounts – Issue of Debentures
- Chapter No. 10 – Redemption of Debentures
T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)
- Chapter No. 1 – Financial Statements of a Company
- Chapter No. 2 – Financial Statement Analysis
- Chapter No. 3 – Tools of Financial Statement Analysis – Comparative Statements and Common- Size Statements
- Chapter No. 4 – Accounting Ratios
- Chapter No. 5 – Cash Flow Statement
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