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Accounting for Share Capital — Accountancy STD 12 Commerce — Question

CBSE BoardEnglish MediumSTD 12 CommerceAccountancyAccounting for Share Capital1 Mark
Question
While preparing the transferee company's financial statement under amalgamation in the nature of merger, the assets and liabilities taken over from the transferor company should be incorporated at _____.
  1. Cost
  2. Book value
  3. Revised value
  4. None of these
✓

Answer

  1. Book value
Explanation:

In case of other assets, the fair value may be determined by reference to the market value of the assets given up. Where the market value of the assets given up cannot be reliably assessed, such assets may be valued at their respective net book values.

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