The profits of the firm for the five years are as follows:

Calculate the value of goodwill on the basis of three years' purchase of weighted average profits based on weights of the last five years as 1,2,3,4 and 5 respectively.

₹69,600

The correct answer is option 4- ₹69,600. 

Weighted average profit = Total of weighted profits/Total of weights
                                   = 3,48,000/15
                                   = 23,200

Goodwill = Weighted average profit x no of years purchase
             = 23,200 x 3
             = 69,600