PURCHASED GOODWILL METHOD UNDER IND AS 103

This image has an empty alt attribute; its file name is purchased-goodwill-calculation-method-under1.jpg

The acquisition of subsidiaries results in Goodwill calculation and also records net assets of the subsidiary at fair value on the date of acquisition. Let’s get answers to all the questions related to Goodwill, valuation of NCI, and impairment relating to them.

Q1 – What are the ways in which an entity can make payment for purchase consideration?

ANS:

– Cash

– Share exchange

– Deferred payment

– Contingent consideration

Q2 – How is deferred payment dealt, when it forms part of purchase consideration?

ANS: The deferred payment is discounted to present value and included in the cost of consideration. At the end of each year, the liability is increased by unwinding the discount, until the payment is settled. For example,

An amount of Rs. 108,000 was deferred to be paid after 2 years. The discount rate applicable is 8%. The net present value today of Rs. 108,000 is equal to (108,000 * 1) / (1.08) ^2)= Rs. 92,593 included in purchase consideration.

A liability of Rs. 92,593 is recorded on the same day.

At the end of the year, the unwinding of discount (8%*92593) results in a charge of Rs. 7,407 to profit & loss a/c for the unwinding of discount, increasing the Liability to Rs. 100,000 (92,593 + 8%*92593 = Rs. 100,000).

Learn more Goodwill Calculation – IFRS 3 Business Combinations questions here....

CALL AT 8800999280 / 8800999283 / 8800999284 FOR ANY OTHER DETAILS:

Comments

Lessons-Worksheets-Question Papers-CBSE Class 2 English

Lessons-Worksheets-Question Papers-CBSE Class 2 English CBSE 2nd Class English – One and Many In this blog, we share the spelling rules used in the concept of One and Many. When there is only one of a naming word (noun), it is said to be a singular noun . When a noun shows more than one, it is said to be in the plural . We can add –S, -es, -ves or ies to show that there is more than one noun. For example, we say many birds, four biscuits, six brushes. But for the students of Class 2 , it’s very difficult and confusing to understand where to use s , es, ves or ies in the form of many. Don’t worry, it looks difficult, but it is very easy as in grammar each concept has a set of rules that need to practice. Noun ending with –s, -x, -o, -sh, -ch, and –ss form plurals by taking –es. Look at these pairs of words: Bus – Buses Brush – Brushes Continue ..... Click here ...

Magnetic and non-magnetic material Class 6 Science

Magnetic and non-magnetic material Class 6 Science A magnet is a substance that is drawn to certain magnetic materials like iron, cobalt, and nickel. Magnets have the ability to draw iron to them. Natural magnets are rocks that naturally draw iron. Non-magnetic materials include things like wood, rubber, coins, feathers, leather, etc. that are not drawn to iron. Magnet characteristics It pulls magnetic materials, such as iron. The magnet's two ends are referred to as its poles. The magnet's diametrically opposed poles are drawn together. Heating, hammering, or dropping causes it to lose its characteristics. On the basis of properties types of Magnets Temporary magnets are those magnets that are magnetic for only a little duration. Typically, iron, cobalt, or nickel are used to make them. When they are close to the powerful magnet, they act like a magnet. When they are yanked away from the powerful magnet, they stop being magnetic. Permanent magnets are magnets that have magne...

Class 3 English Practice Grammar Worksheet -The Adverb

Class 3 English Practice Grammar Worksheet -The Adverb Class 3 English – The Adverb – Kinds of Adverb Fill in the blanks with suitable Adverbs of place. Choose from the box. Up outside everywhere back down away here there ...

Takshila Learning - Online Tutorials

Search This Blog