Q14 A and B are partners sharing profits and losses in the ratio of 5 3 On 1st April 2019 C is admit......

Q14.A and B are partners sharing profits and losses in the ratio of 5 : 3. On 1st April, 2019, C is admitted to the partnership for 1/4th share of profits. For this purpose, goodwill is to be valued at two years' purchase of last three years' profits afterallowingpartners′remuneration

. Profits  to be weighted 1 : 2 : 3, the greatest weight being given to last year. Net profit before partners' remuneration were: 2016-17 :  2,00,000; 2017-18 :  2,30,000; 2018-19 :  2,50,000.  The remuneration of the partners is estimated to be 90,000 p.a. Calculate amount of goodwill.

By: Aman