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Valuation of goodwill
Why depreciation is not deducted from revalued assets while calculating Capital Employed ?
Replies (2)
It is deducted from Future Maintainable profits, and only when it is specifically instructed...no question of deducting dep from Cap employed..
becoz while caluculating goodwill, we create a DUMMY COMPETITOR.. supposing that he has started his business today and at what amount he will get the same assets as we have.....depreciation is only a book entrry it has nothing to do with market value of an asset.....
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