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Amalgamation (purchase consideration)

134 views 2 replies

Lahari

Student CA IPC / IPCC

44 Points Joined September 2014

while calculating purchase consideration, should premium be calculated on nominal value or paid up value?.
In illustration 7 of IPCC text book, the premium is calculated on paid up value. can someone please clarify this. thank you.

Replies (2)

ACCOUNTANT

Student

559 Points Joined September 2011

Premium will be in terms of the agreement of amalgamation or merger or reconstruction..... If they say they are paying premium on nominal value...it will be so.. .or if they say on paid up value it will be so... Anyway it will be mentioned in the question.. .please check... Please correct me if I am wrong

Guest

Originally posted by : Lahari
	while calculating purchase consideration, should premium be calculated on nominal value or paid up value?.In illustration 7 of IPCC text book, the premium is calculated on paid up value. can someone please clarify this. thank you.