in case of amalgamation in the books of transferor company the assets are transferred to realisation a/c at ____
1. agreed value
2. book value
3. Market value
4. original value
Answers
Answer:
original
Amalgamation means the liquidation of one or more companies and transfer of business of liquidated entities to another entity. There may be amalgamation either transfer of two or more undertakings to an existing company or new company.
In the part -1 CLICK HERE FOR PART - I Accounting for amalgamation we learnt about nature of amalgamation and method of accounting, now we are going to learn journal entries in the event of amalgamation.
JOURNAL ENTRIES IN BOOKS OF TRANSFEROR COMPANY AND TRANSFEREE COMPANY
IN THE BOOKS OF TRANSFEROR COMPANY(SELLING COMPANY)
Accounting standard 14 is not applicable for selling company.
Accounting is done with the objective of closing books of accounts and simultaneous determination of profit or loss on closing books of accounts.