Explanation:
When cash is realized in installments during dissolution, it is distributed using either the Maximum Loss Method or the Surplus Capital (Proportionate Capital) Method to ensure partners' capital accounts are correctly adjusted.
A firm's average profit is ₹1,20,000, normal rate 10%, capital employed ₹8,00,000. Goodwill by capitalisation of average profit method will be: (Capitalised value of average profit less net assets)
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