The profit for the five years of a firm are as follows:

Calculate goodwill of the firm on the basis of 4 years purchase of 5 years average profits.

Rs. 17,54,400

The correct answer is Option (2) → Rs. 17,54,400 

• Total Profit = 4,00,000 + 3,98,000 + 4,50,000 + 4,45,000 + 5,00,000 = 21,93,000

• Average Profit = 21,93,000 ÷ 5 = 4,38,600

• Goodwill = 4,38,600 × 4 = 17,54,400