average net profits expected in future by Khalifa and Co. are OMR 30,000 per year. The average capital employed in the business by firm is OMR 200,000. The normal rate of return on the capital employed in similar business is 10%. Calculate goodwill of the firm by: 1. Super Profit Method on the basis of two-year purchase 2. Capitalization Method
average net profits expected in future by Khalifa and Co. are OMR 30,000 per year. The average capital employed in the business by firm is OMR 200,000. The normal rate of return on the capital employed in similar business is 10%. Calculate goodwill of the firm by: 1. Super Profit Method on the basis of two-year purchase 2. Capitalization Method
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter8: Basic Stock Valuation
Section: Chapter Questions
Problem 9MC
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The average net profits expected in future by Khalifa and Co. are OMR 30,000 per year. The average capital employed in the business by firm is OMR 200,000. The normal rate of return on the capital employed in similar business is 10%. Calculate goodwill of the firm by:
1. Super Profit Method on the basis of two-year purchase
2. Capitalization Method
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