sita ,geeta and reetaare partners in a firm sharing profits and losses in the ratio 4:3:1.as per the terms of partnership deed on the death of any partner ,goodwill was to be valued at 50% of the net profit credited to that partner's capital A/c during the last 3 completed years before her death .sita died on 29 feb 2012.the profits for the last 5 years were
2007 60000
2008 97000
2009 105000
2010 30000
2011 84000
calculate amount of sita share of goodwill in the firm
Priya, the solution to your query is here.
Total profits amounted to Rs 2,19,000 (84,000 + 30,000 + 1,05,000)
Now, Sita's share in this profit is only 4/8 which is Rs 1,09,500 (i.e. Rs 2,19,000*4/8)
And, Sita's share of Goodwill is Rs 54,750 (50% of Rs 1,09,500)