Capital employed by a partnership firm is ₹ 5,00,000. Its average profit is ₹ 60,000. The normal rate of retum in similar type of business is 10%. What is the amount of super profits?

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₹ 10,000 Explanation: Given: Capital Employed = ₹ 5,00,000 Average Profit = ₹ 60,000 Normal Rate of Return = 10% Normal Profit = Capital Employed `xx "Normal Rate of Return"/100 = 5,00,000xx10/100` = ₹ 50,000 Super Profits = Average Profit − Normal Profit = 60,000 − 50,000 = ₹ 10,000

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