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Goodwill

Accountancy

In the answer why half of the amount withdrawn by the partners is added and half of the profits were subtracted???

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Gowshika LT

CA Final

★ 40K+

19-Jul-20 11:57

400

Answers (2)

Average Capital Employed =(opening capital employed + closing capital employed)/2 or alternatively Average Capital Employed = Capital Employed + 1/2 drawings â?? Â½ Current Yearâ??s Profit (as the assumption is drawings and profits are done or earned uniformly over the year)