I have this query from the chapter amalgamation from study module unsolved question PCC
balance sheet of X ltd. taken over by Y ltd.
liabilities assets
share capital(100) 40000 goodwill 80000
general reserve 80000 L&B 110000
p&l 38000 P&M 250000
Workmen compensation (liabilty 8000) 15000 stock&debtor 140000
Fire Insuran ce fund 60000 underwriting commision 10000
creditors 70000 prepaid expense 5000
provision for tax 50000 cash 118000
TOTAL 713000 Total 713000
calculate PC in each case
1) all assets except cash are taken over at values stated in the balance sheet ; and liabilties except that for taxation are assumed
2) each shareholder is paid 20 in cash and issued 100 each, valued at 120 for every 5 shares held; all assets and liabilities taken over
3) each share in the X co. is valued @ 150, PC to be discharged in form of shares in Y co @ 200 per share(entries being made at par value @ 100)
Also show p/l on realisation in each of the above case , assuming that liability for taxation in each case is 55000 and expenses of liquidation are 15000
answer: PC profit /loss on realisation
1) 507000 loss 15000
2)656000 profit 61000
3) 300000 loss 295000
Also what will be the value placed on goodwill by Y ltd, in each of the above case assuming L&B valued at 150000 and P&M 230000 Answer: 1) 60000 2) capital reserve 220000 pls provide help in this regard I am unable to get these answers.
CAclubindia
