Question

Excess of net asset over purchase consideration is considered as

Answer 1

cpaital reserve when amalgamation is in nature of purchase.. General Reserve when it is in nature of merger

Answer 2

Excess of the net asset over purchase consideration is considered or transferred in goodwill.

Explanation:

Excess of the net asset over purchase consideration is considered or transferred in goodwill.

• Goodwill in accounting is an intangible asset that arises when a buyer acquires an existing business. Goodwill represents assets that cannot be identified separately.
• Under this method, both assets and liabilities are taken into account.
• They are applied to total valued assets in this form of purchase consideration, and liabilities are then deducted from total assets.
• The balance is said to be reimbursed for goodwill if any additional amount is paid over and above the net asset against the sale price.