Average Profit needs to be calculated first from the profits of last 5 years:
Average Profit = 540,000+50,000+55,000+70,000+85,000 = 53,00,000 = Rs. 60,000
Normal Profit is calculated on the capital employed at the normal rate of return:
Normal Profit = Capital Employed × Normal Rate of Return
Normal Profit = Rs. 5,00,000 × 10010 = Rs. 50,000
Super Profit = Average Profit - Normal Profit
Super Profit = Rs. 60,000 - Rs. 50,000 = Rs. 10,000
Super profit represents the excess profit earned by the business over and above what would be considered normal for the capital employed. Here, the business earns Rs. 10,000 more than the expected return of 10% on the capital of Rs. 5,00,000.