AMALGAMATION

We pass two JE for that 1) Business purchase a/c Dr To liquidators of company a)c 2) assets a/c Dr To liabilities a/c To business purchase a/c (The excess or surplus of it will be capital gain /goodwill) Whenever you purchase something you pass purchase ac Dr to cash/creditor a/c Same passed here instead of purchase u passed business purchase (in liquidation time liquidators take responsibility to settle assets and liabilities so we are crediting his ac. In scnd entry we are reversing the business purchase to cancel it so it is credited

Revathy N

CA Final

★ 9K+

22-Jan-24 10:53

You can combine and pass a single entry but sometimes you can miss.

CA Suraj Lakhotia

Admin

22-Jan-24 14:54