Acquisiton of Business

This query is : Resolved

jayaraman subramanian (Querist)
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15 April 2009 Dear All,

I am working i a Ltd Co. Our Company has acquire the bussiness of one of our group company and we had paid Rs. 2 Crore . I would like to know the accouting entries for the same.

Thks

Ashish Aggarwal

Ashish Aggarwal (Expert)
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15 April 2009 Assuming that your company didnot hold any shares of this group Company you will need to pass entry like following

Fixed Asset Dr
Curent Asset Dr
To Liability
To Bank

Manmohan ACA, CS

Manmohan ACA, CS (Expert)
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17 April 2009 Entry: 1
Business Purchase Dr. 2 Crores
To Cash/ bank / eq share etc 2 Crores

Entry :2
All assets A/c Dr.
General reserve or P/L (if loss)
To All Liability
To Business Purchase
To General reserve or P/L (if profit)

Entry (1) and (2) can be merged