Question

The purchase consideration at the time of sale of firm to a company will be transferred to
A. Realisation A/c
B. Capital A/c
C. Cash A/c
D. None of these​

Answer 1

Answer:

I think the answer is a.

Answer 2

Capital account.

On account of amalgamation, purchase consideration is the concurred sum that the transferee organization (Purchasing organization) pays to the transferor organization (Vendor organization) in trade for the ownership of the transferor organization. It could be in the type of money, shares, or any different resources as concurred between both the organizations. 'Purchase of Business' essentially alludes to the procurement of a sole ownership firm or an association firm or an organization by a restricted organization.