Question

On amalgamation fictitious assets are transferred to______?​

Answer 1

Answer:

During Amalgamation , Realization Account is opened and all the assets except any fictitious assets like preliminary expenses, underwriting commission, discount on issue of shares or debentures, profit and loss account (Dr.) balance, etc., are transferred to it at their book value.

Answer 2

On amalgamation fictitious assets are transferred to their book value.

Step-by-step explanation:

• During amalgamation, a Realization Account is formed, and all assets, save fictitious assets, are transferred to it at their book value, with the exception of preliminary expenditures, underwriting fee, discount on issuing of shares or debentures, profit and loss account (Dr.) balance, and so on.
• In the profit-sharing ratio, fictitious assets that represent losses are debited to capital accounts of partners.
• Fictitious assets are assets that do not exist in the physical world but are portrayed as genuine monetary expenditures.
• Expenses incurred in beginning a firm, goodwill, patents, trademarks, and copy rights fall under the category of expenses that do not fit into any of the other sections.