The average profit earned by a firm is Rs. 7,50,000 which includes overvaluation of stock of Rs.30,000 on an average basis. The capital invested in the business is Rs. 4,20,000 and the normal tare of return is 15%. Calculate goodwill of the firm on the basis of 3 time the super profit.
Average profit earned by a firm = Rs.7,50,000
Overvaluation of stock = Rs.30,000
Average actual profit = Average profit earned by a firm- overvaluation of stock
