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Treatment of goodwill
Accountancy
In answer they take profit and amount withdrew by partners are taken only 1/2 off the amount
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No, question does not mean that the half of profit is withdrawn from the firm, it means that drawings during the year are 1,50,000 and profit during the year is 2,00,000 and balance sheet is prepared at the year end, So to get the average capital employed at the beggining of year (For computation of normal profit) we need to do back caluclation i.e Total capital at the end of year means as on B/S date-profit+drawings.
