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Capital employed is Rs. 5,00,000, normal return 10%, average profit Rs. 60,000. Goodwill at 3 years' super profits?
ARs. 10,000
BRs. 30,000
CRs. 1,50,000
DRs. 1,80,000
Answer & Solution
Correct answer: B. Rs. 30,000
Normal profit is 50,000, super profit is 10,000, and three years' purchase gives 30,000.
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