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In pooling of interest method why difference between the amount recorded as share capital issued and the amount of share capital of transferor company is adjusted in reserves
Replies (2)
Share capital is worth of a company. Anything paid below the worth of a co is a profit / surplus for you. hence such diff is capitalised by transfering it to R&S ( jus like surplus in p&l is transfered to r&s). And anything paid more than the worth of the company is a loss. hence we reduce that amount from reserves or create goodwill
Tnq for ur reply, but can u clarify that we do adjust from whose reserves transferor or transferee?
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