Amalgamation and Reconstruction Quiz

Amalgamation refers to:

• Dissolution of a company

• Purchase of machinery

• Combining two or more companies

• Preparing financial statements

Purchase consideration is the amount paid by:

• Vendor company

• Purchasing company to shareholders

• Auditor

• Government

In lump sum method, the purchase consideration is:

• Calculated item-wise

• Given as a single total amount

• Calculated after adjustments

• Based on profit

Net assets method = Total Assets - ___________

• Equity

• Capital

• Liabilities

• Reserves

Net payment method considers:

• Payments made to company

• Payments to shareholders of the selling company

• Total income

• Assets and liabilities

Intrinsic value method is used to find:

• Net profit

• Debtors

• Value of share

• Loss

In amalgamation, the company being taken over is called:

• Holding company

• Vendor company

• Debtor

• Government

In Pooling of Interest Method, assets are recorded at:

• Revalued amount

• Book value

• Market value

• Intrinsic value

The Purchase Method is used when amalgamation is in the nature of:

• Merger

• Consolidation

• Purchase

• Takeover by government

Goodwill arises in which method of amalgamation?

• Pooling of Interest

• Purchase Method

• Net Assets

• Lump sum