hello sing giiiiiii,
OLD CO. NEW CO.
SUNDRY ASSETS 10,00,000/- 12,00,000/-
LESS: LIABILITIES 3,00,000/- 4,00,000/-
TOTAL ASSETS 7,00,000/- 8,00,000/-
1) INTRINSIC VALUE OF INVESTMENT OF OLD CO. = 7,00,000 + 5%(8,00,000 + 20%) THERE FORE WE GET OLD COMPANY INSTIC VALUE = 7,47,475/-
VALUE PER SHARE = 7,47,475/10,000 SHARES = 74.75 PER SHARE.
2) INTRINSIC VALUE OF INVESTMENT OF NEW CO. = 8,00,000 + 20% OF 7,47,475 = 9,49,495/-
VALUE PER SHARE = 9,49,495/20,000 SHARES = 47.50 PER SHARE.
TOTAL NO.OF SHARES OF OLD CO. = 10,000/-
LESS SHARES ALREADY HELD BY NEW CO. = 2,000/-
BALANCE SHARES = 8,000/-
VALUE OF THE ABOVE SHARES = 8,000 * 74.75 = 5,98,000/-
NO.OF SHARE ISSUABLE AT INTRINSIC VALUE OF NEW COMPANY = 5,98,000/47.5 = 12,590/- SHARES
LESS NO. OF SHARES ALREADY HELD BY OLD COMPANY = 1,000/- SHARES
THEREFORE NO.OF SHARES TO BE ISSUED TO OLD CO. = 11,590/- SHARES
PURCHASE COSIDERATION = 11,590 * 47.50 = 5,50,525/-
NOTE: SINGH GIIIIIIII VARIATION BECAUSE OF ROUND FIGURES TAKEN BY MEEEE
YOUR ANS. = 5,50,450/-
MY ANS. = 5,50,525/- DUE TO ROUND FIGURES TAKEN BY MEEE.
CAclubindia
