Question

What is 'purchase consideration'? Explain the various methods of calculating pufchase . Consideration.

Answer 1

Purchase Consideration – Meaning & Methods

Methods of Purchase Consideration: There are four various methods which can be used in this calculation:

Net asset method – Purchase consideration is equal to the total net asset of transferor company.

Net payment method

Lump sum method

Intrinsic value/ Share exchange method

Answer 2

Answer:

Purchase Consideration – Meaning & Methods

Methods of Purchase Consideration: There are four various methods which can be used in this calculation:

Net asset method – Purchase consideration is equal to the total net asset of transferor company.

Net payment method

Lump sum method

Intrinsic value/ Share exchange method