accounting for take over of business

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Rakesh (Querist)

05 June 2011 help me to solve the given problem
Service Means providing Yoga treatment
Q. B Ltd take over the chain or Network business of A which is a trust are managed by the directors of B Ltd . Terms are ,
B Ltd agreed to take over the entire network of the business that has been made by the trust , by providing the service to the members of that chain or give a right to convert the benefit into contribution towards share capital of a tune of 50% of the amount paid by them. how it will be accounted according to GAAps and ACS ?

Pankaj Gandhi Jaiswal

Pankaj Gandhi Jaiswal (Expert)

06 June 2011 You will require following valuation.
1- Share Valuation to be transfered at what rate at Par or with premium.
2-Valuation of Business for Purchase Consideration.
3-Valuation of Fixed Assets to recognise assets in the books after take over and look the impairement if any.
4- Shareholder agreement
Other activities are also required better to hire a good CA firm for this

Rakesh

Rakesh (Querist)

06 June 2011 thank u sir. but these are the steps adopted when the entire business ( including Fixed Assets),in this specific case the business is carried by the trust are network business of ayurvedic treatment. for eg if a person taking coupon of Rs.5 will get treatment. In this case the said company taking over that chain of business of trust and nothing else.