Question : Capital invested in the firms business is termed as
Option 1: Super profit
Option 2: Average profit
Option 3: Normal profit
Option 4: Capital employed
Correct Answer: Capital employed
Solution : Answer = Capital employed
Capital invested in a firm's business is referred to as "capital employed." This includes all the funds contributed by shareholders and borrowed capital that are utilized in the company's operations. It encompasses both equity and debt financing and is crucial for assessing the efficiency of capital utilization and profitability. Hence, the correct option is 4.
Question : Average of the profit of past agreed years is known as __________.
Question : Under the super profit method, goodwill is calculated by
Question : When a similar type of business earns profit at a standard percentage of the Capital employed, it is called __________ .
Question : Under average profit methods goodwill is calculated as
Question : The average capital employed in a business is Rs.5,00,000 and the average net profit earned is Rs.65,000. If normal rate of return on capital employed is 8% and remuneration of Rs.20,000 is expected, then the super profit of the concern is:
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