Question : Prakash Ltd. purchased assets worth Rs.2,20,000 and also took over the liabilities (creditors) of Rs.40,000 of Ajay Ltd. for a purchase consideration of Rs. 1,92,000. Prakash Ltd. paid the purchase consideration by issuing 12% debentures of Rs.100 each at premium of 20%.
Difference between purchase consideration and Net Assets are debited/credited to
Option 1: Debited to goodwill account by Rs 12,000
Option 2: Credited to capital reserve account by Rs 12,000
Option 3: Debited to profit and loss account Rs 12,000
Option 4: Credited to General reserve Rs 12000
Correct Answer: Debited to goodwill account by Rs 12,000
Solution : Answer = Debited to goodwill account by Rs 12,000
Goodwill = 1,92,000 - 1,80,000
= Rs 12000 Hence, the correct option is 1.
Question : Prakash Ltd. purchased assets worth Rs.2,20,000 and also took over the liabilities (creditors) of Rs.40,000 of Ajay Ltd. for a purchase consideration of Rs.1,92,000. Prakash
Ltd. paid the purchase consideration by issuing 12% debentures of Rs.100 each at a premium of
Question : Prakash Ltd. purchased assets worth Rs.2,20,000 and also took over the liabilities (creditors) of Rs.40,000 of Ajay Ltd. for a purchase consideration of Rs.1,92,000. Prakash Ltd. paid the purchase consideration by issuing 12% debentures of Rs.100 each at a premium of
Question :
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