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  • Accounting For Partnership Firms: Goodwill

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    Kul Deep
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    Goodwill refers to the reputation and name recognition of a business that allows it to earn extra profits. It is created through honest business practices like selling quality products. Goodwill can be affected by factors such as the nature of the business, its location, management efficiency, longevity, and level of competition. Goodwill can be calculated using methods like the average profit method, super profit method, or capitalization method, which involves capitalizing the business's average or super profits.

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    goodwill

    Original Title

    goodwill introduction

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    Goodwill refers to the reputation and name recognition of a business that allows it to earn extra profits. It is created through honest business practices like selling quality products. Goodwill can be affected by factors such as the nature of the business, its location, management efficiency, longevity, and level of competition. Goodwill can be calculated using methods like the average profit method, super profit method, or capitalization method, which involves capitalizing the business's average or super profits.

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    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
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    6 views8 pages

    Accounting For Partnership Firms: Goodwill

    Uploaded by

    Kul Deep
    Goodwill refers to the reputation and name recognition of a business that allows it to earn extra profits. It is created through honest business practices like selling quality products. Goodwill can be affected by factors such as the nature of the business, its location, management efficiency, longevity, and level of competition. Goodwill can be calculated using methods like the average profit method, super profit method, or capitalization method, which involves capitalizing the business's average or super profits.

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    © All Rights Reserved
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    of 8

    ACCOUNTING FOR PARTNERSHIP

    FIRMS:

    GOODWILL
    MEANING OF GOODWILL

    •Goodwill is the reputation of the


    business which help business to earn
    extra profit. It is the name and fame of
    the business which a business create by
    honest activities, by selling good quality
    product etc.
    Factors affecting Goodwill

    •Nature of business
    •Location of business
    •Efficiency of management
    •Longevity of business
    •Entry of Competitor, etc
    Methods of Calculating Goodwill

    III.
    CAPITALISATIO
    I. AVERAGE PROFIT N METHOD
    METHOD 1.
    II. SUPER
    1. Simple Average PROFIT Capitalisation
    Profit Method METHOD of Average
    2. Weighted Average Profit
    Profit Method 2. Cap. Of
    Super Profit

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