provision for tax
This query is : Resolved
19 August 2010
Thank you Amit sir for responding, however since income tax does not accrue evenly over time I don't think that it will be appropriate to apportion it on the basis of time. I feel it should be apportioned on the basis of profit or sales.could u please clarify the same giving the logic behind your reply.
Aditya Maheshwari
(Expert)
19 August 2010
It should be distributed in proportion of profit or sales only.
Message likes :
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CA Amit Joshi
(Expert)
19 August 2010
U have to first calculate Profit of pre and post acquisition by dividing expenses in time or sales ratio. After it on the basis of ur profit u have to calculate/divide the provision for tax. It will be near to the amount which will came if u calculate it using time ratio.
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