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Discussing Advance accounting question paper

06 June 2019

Can Amalgamation of firms be solved by opening revaluation account? Or it is compulsory to solve by opening realization account? I solved it by opening revaluation account in today's paper

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12 Replies

Manish (Student) (22 Points)
Replied 07 June 2019

No you have to solve by opening Realisation Account only

Kishan Thakkar (13 Points)
Replied 07 June 2019

nope!! you can solve it by revaluation account too

1 Like

Hardik Rawal (14 Points)
Replied 07 June 2019

it can be done by both ways and anyways it was not required part so don't worry at all

1 Like

Deep j.Shah (Articleship) (28 Points)
Replied 07 June 2019

it can be solved by both. don't worry

1 Like

Anubhav Somani (2 Points)
Replied 07 June 2019

yes it can be solved without opening revaluation account through realization account in case of amalgamation questions

Kishan Thakkar (13 Points)
Replied 07 June 2019

there was no specifications in the question that you have to make a realisation account so whatever account you open either it's a revaluation account or realisation account it's part of your working.so if your answer is right it doesn't matter if you solved it by opening a realisation account or revaluation account

Sai Preetam (CA Student) (55 Points)
Replied 07 June 2019

I have solved by calculating PC without opening realisation a/c is it correct?

LOKANADHAM M N (ipcc) (22 Points)
Replied 07 June 2019

whenever the going concern is absent we have to open realisation account ,in amalgamation of firms, in the books of selling company we have to open realisation account only

Dhana Sai (234 Points)
Replied 07 June 2019

to be honest as per conceptual clarity

even two firms are amalgamating the business remains same so

if u open realization account it means ur business was closed

as per concept it is better to open revaluation account

but in sm and pm icai used both methods more oftenly they used revaluation only

no problem

1 Like

Manish Kholiya (6 Points)
Replied 07 June 2019

Thank you all for clarifying.. coz I was worried whether ICAI will deduct the marks if I solve by revaluation method.. but now it's clear that it can be solved by opening revaluation account also..

Amitsavla (CA) (59 Points)
Replied 07 June 2019

Hello
while calculating PC Net asset Taken Over will result is reduction of Cost of issue of debentures as stated in question that it should be excluded? if not then what is the implication of Cost of issue of debentures?