Mergers

As per AS – 14 purchase consideration is what is payable to

• Shareholders

• Creditors

• Debenture holders

• Shareholders and Debenture holders

When amalgamation is in the nature of merger, the accounting method to be followed is:

• (a) Equity method

• (b) Purchase method

• (c) Pooling of interests method

• (d) Consolidated method

When amalgamation is in the nature of Purchase, the accounting method to be followed is:

• (a) Equity method

• (b) Purchase method

• (c) Pooling of interests method

• (d) Consolidated method

Under pooling of interest method the difference between the purchase consideration and share capital of the transferee company should be adjusted to:

• (a) General reserve

• (b) Amalgamation adjustment account

• (c) Goodwill or capital reserve

• (d) None of the above

Under purchase method the difference between the purchase consideration and share capital of the transferee company should be adjusted to:

• (a) General reserve

• (b) Amalgamation adjustment account

• (c) Goodwill or capital reserve

• (d) None of the above