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Problem 3: Goodwill calculation - Weighted Average Profits method The trading profits of a company for the past 4 years were as follows: Year ended
Problem 3: Goodwill calculation - Weighted Average Profits method The trading profits of a company for the past 4 years were as follows: Year ended Dec 31, 2015 - Dh 120.000; 2016 - Dhs. 136,000; 2017 - Dhs. 164.000: 2018 - Dhs. 172,000. Standard rate of return fa this type of business is 8%. Calculate the value of goodwill at three years purchase of average supe profits for the four years. Assume the weights assigned to profits are as follows: 2015:1 2016: 1.5 2017:2 2018: 2.5
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