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Question 24 Chapter 3 of USHA Publication 12 Class Part – 1

Question 24 Chapter 3 of +2 Part-1 - USHA Publication 12 Class Part - 1
Question 24 Chapter 3 of +2 Part-1 - USHA Publication 12 Class Part - 1

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Question 24 Chapter 3 of USHA Publication 12 Class Part – 1

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24. (Calculation of Super Profits and Average Profits when Goodwill and Total Assets are given) Ludhiana Garments has total assets (excluding goodwill) of ₹ 1,87,500, including cash of ₹ 12,500. The Capital account of partners X and Y showed a balance of ₹ 1,20,000 and the balance was reserves. Normal rate of return was 10% and the goodwill was valued ₹ 60,000 at four year’s purchase of super profits. Find out average profits of the firm.

 

The solution of Question 24 Chapter 3 of USHA Publication 12 Class Part – 1: – 

       
GoodwillSuper Profits x Number of years’ purchase
Super Profit=Goodwill
  No. of year purchases
 =60,000
  4
                                               =15,000
Super Profit  = Average – Normal Profit
Average Profit  = Super Profit + Normal Profit
   = 15,000 + 18,750
   = 33,750

 

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Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

 

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Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

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