10 June 2010
SIR, PLEASE SUGGEST ME WHAT ACCOUNTING ENTRY SHOULD BE PASS WHEN ANY ASSET IS NOT TAKEN OVER BY PURCHASING COMPANY... REALISATION A/C DR.. TO,ASSEST A/C
BANK A/C DR.. TO,REALISATION A/C
OUR CLASS SIR SUGGEST THE ABOVE EFFECT FOR THE PROBLEM.. WHETHER THE ABOVE ALTERNATIVE IS CORRECT OR NOT...
10 June 2010
Yes romil, treatment suggested by your sir is correct.
When the company is completely taken over by other, all assets are to be transferred to Realisation Account by selling company, whether taken over by purchasing co. or not and when the said asset is sold, sales proceeds are to be taken to Realisation Account. The treatment mentioned is correct.
CAclubindia
