What is the correct sequence for calculating goodwill by Capitalisation of Average Profit Method?
(A) Compute the value of goodwill
(B) Find Capitalized value of the average profits
(C) Ascertain the average profits
(D) Ascertain the actual firm's capital
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → C, B, D, A
(C) Ascertain the average profits
(B) Find Capitalized value of the average profits
(D) Ascertain the actual firm’s capital
(A) Compute the value of goodwill
NCERT (2026-27 edition):
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