Advanced accounts - amalgamtion

Debentures would be transferred to realisation account. Shares would be issued to debenture holders directly

CA Suraj Lakhotia

Admin

02-May-22 11:35

They are part of purchase consideration. Rule - anything given to equity holders is a part of purchase consideration.

CA Suraj Lakhotia

Admin

02-May-22 10:59

So tht means if debenture holders are given equity then it will be part of purchase consideration

Thread Starter

Sahana S

CA Inter

★ 0

02-May-22 11:02

Sorry - I misread your question. Any thing given to debenture holders would not be a part of purchase consideration. In purchasing company books - instead of debentures being issued/ equity is issued. No change in treatment.

CA Suraj Lakhotia

Admin

02-May-22 11:04

Can you elaborate about the treatment in the books of selling co. ie in realization and equity shares of purchasing co.

Thread Starter

Sahana S

CA Inter

★ 0

02-May-22 11:18

So wont there be an entry in the ledger share in purchasing co. Acc?

Thread Starter

Sahana S

CA Inter

★ 0

02-May-22 13:57

Purchasing company would first incorporate Debentures. THen Debentures Dr. To ESC

CA Suraj Lakhotia

Admin

02-May-22 15:21

Sir i meant whtz the entry in selling companies books

Thread Starter

Sahana S

CA Inter

★ 0

02-May-22 16:44

No

CA Suraj Lakhotia

Admin

03-May-22 13:46