When agreed value of consideration is intrinsic value (₹30 in this example) of Y ltd. But it shows it at Face value (₹10)

answered on 24-Apr-24 22:04

In this example, when Yltd. Decides to show the purchase consideration at par value i.e. ₹10 per share, so in books we mentioned purchase consideration as 50,00,000 shares x ₹10 per share, but what about the rest portion of purchase consideration that Yltd.paid to X ltd but doesn't show in books that is rest ₹20 per share (₹30-₹10, agreed value -fave value)?

latest answer

Liquidators A/c Dr 8000000 To psc A/c 3000000 To Esc A/c 5000000 If premium is allowed then Liquidator a/c Dr. 18000000 To psc 3000000 To Esc 5000000 To securities premium 10000000

Garima Bhargava

CA Inter

★ 185

4

82

Amalgamation of companies

answered on 30-Apr-24 17:18

In this question 7, (A) 4th point at a discount of 5% after takeover means?? Here they taken the full value of debenture for Net assets calculations of K Ltd

latest answer

issue price is 5% less.

Ramya Sundar

CA Inter

★ 5K+

1

72

As 13

answered on 24-Apr-24 14:32

I purchased current investment on 1 /10/23.(F.y23-24) For 50lakh As on 31/3/24.fair value is 40 lakh. Since it is current investment, I carry this investment @ 40 lakh as on 31/3/24. 10 lakh is debited to p&l F.Y24-25 On 1/5 /24 , i decided to convert short term into long term investment. Fair value on 1/5/24 is 20 lak Now conversation should happen at lower of cost or fair value on date of conversation Cost =50 lakh( historic cost) Fairvalue = 20 lakh Hence conversion should happen at 20lakh Now my doubt is how much shld be charged to p&l in F.Y24-25 My anwer is 20 lakh charge to p&l. (difference between carrying value(40lakh) and 20lakh( conversion value) Is my understanding correct??

latest answer

Thank you sir

Krishnan K

CA Inter

★ 5K+

2

72

As 16

answered on 23-Apr-24 16:40

Is my understanding correct? Maximum amount that can be capitalised to cost of asset is to the extent of NRV Hence only5k is capitalised

latest answer

Yes

Krishnan K

CA Inter

★ 5K+

1

117

AS 10 - Trade and Cash Discounts

answered on 25-Apr-24 18:50

Are settlement discounts considered as Cash Discounts? Would a discount for full payment at the time of completion of sale also be a Cash Discount? How do we treat it as per AS-10

latest answer

For deferred payment, calculate present value using discount rate.

Vishnu

CA Inter

★ 22K+

5

122

Financial Statements - Illustration 2

answered on 24-Apr-24 14:54

Hi Sir, As You were explaining about the Reissue of Forfeited Shares of above mentioned illustration, it is being mentioned in the Question that The reissue has been done at the Rs. 90, however, the face value of share is Rs. 100. Therefore, I request your kind self to explain about the legibility of Issuing forfeited share less than Face Value.

latest answer

Since its already issued and you have collected amount at time of first issue, it is allowed.

Aakash Raj

CA Inter

★ 0

1

66

Ca inter

answered on 21-Apr-24 19:18

Amalgmation page no13.78 in Q.13 while calculating capital employed ,effect of mutual owing has not been taken but in calculating net asset that effect is taken??

latest answer

Pls share the question as well.

Pooja Chavan

CA Inter

★ 0

1

87

Consolidated fS

answered on 21-Apr-24 19:18

How to treat preliminary expenses in the consolidated balance sheet.

latest answer

Write off.

Gayathri Nambiar

CA Inter

★ 2K+

1

104

Consolidation

answered on 22-Apr-24 09:43

In balance sheet b4 revaluation y u have considered loans and advances as assets General we use to assume it as liabilities only Kindly explain me plz

latest answer

Loan means the company has taken loan from bank, financial institutions etc. So it will be shown under liability. Loans & advances means it is given by company to subsidiaries, employees, financial institutions etc. which can be shown as asset in the balance sheet.

nive krish

CA Inter

★ 255

1

77

Debentures in Amalgamation

answered on 21-Apr-24 19:23

I am little confused when debenture arises in amalgamations.. can anyone say whether debentures shall include in purchase consideration ? And wherever the debentures shall include ?

latest answer

If debentures are given to shareholders - then part of purchase consideration If debentures are issued to settle the existing debenture holders - not a purchase consideration.

Jashvanth.K

CA Inter

★ 9K+

1

80