Question

What is transferor and transferee company? What accounting entries are made in the books of transferor company and transferee company?

Answer 1

Explanation:

Transferor company means the company which is amalgamated into another company. Page 4. Accounting for Amalgamations 147. (c) Transferee company means the company into which a transferor company is amalgamated.

Answer 2

Amalgamation in the nature of merger, all the assets, written off expenses, debit balance of Profit and Loss Account, outside liabilities and reserves of the transferor company have to be recorded in the books of the transferee company in the form and at the book values as they were appearing in the books of the transferor company on the date of amalgamation. However, if there is a conflict in the accounting policies of the transferee and transferor companies, changes in the book values may be made to ensure uniformity.

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