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A request to those whose paper 8 is exempt and exams are over.

My Balance sheet for Amalgamation question did not tally. I want your help to point out where my mistake is. Please. This seemingly easy question gave me a sleepless night. I have attached my answer with workings for Question 3(a). Where is my mistake? How much marks can I expect out of 15?

Attachments

20201206_130823.jpg

20201206_130753.jpg

20201206_130531.jpg

20201206_130906.jpg


Kumarjit Dey

Kumarjit Dey

CA Inter

4K+

06-Dec-20 13:11

26

Answers (7)

Best Answer

No Goodwill or Capital Reserve?


Suraj Lakhotia

Suraj Lakhotia

Admin

07-Dec-20 15:59

Workings in 3 attachment, Balance Sheet in 2nd.


Kumarjit Dey

Kumarjit Dey

CA Inter

4K+

06-Dec-20 13:12

I am 100% sure atleast my workings are right. Fraction ( of debentures ) could be an issue though. But even that cant amount to such huge difference in totals. Reserves of transferor wont become that of transferee because amalgamation is in nature of Purchase.


Kumarjit Dey

Kumarjit Dey

CA Inter

4K+

06-Dec-20 13:18

And one more thing. It could be a problem of 'Merger and Purchase'. But two things to be noted: the problem does not explicitly say that new cpmpany has taken over ALL the assets and liabilities. Number 2, in the last line it is said " amalgamation is to be carried out in the nature of purchase", in which case the General Reserve, Revaluation Reserve and P&L of transferors should not belong to/be adapted in transferee's books. Could, perhaps, the question be wrongly framed?


Kumarjit Dey

Kumarjit Dey

CA Inter

4K+

06-Dec-20 13:39

-_-


Kumarjit Dey

Kumarjit Dey

CA Inter

4K+

07-Dec-20 13:10

No Goodwill or Capital Reserve?

Oh God. The sillest of mistakes!


Kumarjit Dey

Kumarjit Dey

CA Inter

4K+

07-Dec-20 18:41

No Goodwill or Capital Reserve?

Sir, debentures of High Ltd. will be settled by way of 86.67 lacs and of Low Ltd. by way of 48.53 Lacs. Any cash to be paid to them for fractio of debentures or anything like that is required to affect cash outflow?


Kumarjit Dey

Kumarjit Dey

CA Inter

4K+

07-Dec-20 20:45

Happy Mother's Day
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