PROBLEM 5 (Goodwill Computation) The following pieces of information are available in relation to Lavender Corp.'s computation of Lilac Corp.'s goodwill: Net assets, excluding goodwill P120,000,000 Industry's normal rate of return 12% Lilac's net income for the past five years is as follows: 2016 2017 2018 2019 2020 P15,200,000 15,600,000 15,200,000 17,200,000 16,800,000 Compute for Lilac's goodwill using the following methods: 1. Capitalization of average earnings, assuming that average earnings is capitalized at 10% 2. Capitalization of excess earnings for 5 years. 3. Capitalization of excess earning at 25%. 4. Capitalization of excess earnings for 5 years using a discount rate of 12%. PROBLEM 5 (Goodwill Computation) The following pieces of information are available in relation to Lavender Corp.'s computation of Lilac Corp.'s goodwill: Net assets, excluding goodwill P120,000,000 Industry's normal rate of return 12% Lilac's net income for the past five years is as follows: 2016 2017 2018 2019 2020 P15,200,000 15,600,000 15,200,000 17,200,000 16,800,000 Compute for Lilac's goodwill using the following methods: 1. Capitalization of average earnings, assuming that average earnings is capitalized at 10% 2. Capitalization of excess earnings for 5 years. 3. Capitalization of excess earning at 25%. 4. Capitalization of excess earnings for 5 years using a discount rate of 12%