CORPORATE ACCOUNTING | UNIT-2 | AMALGAMATION (AS-14) | PROBLEMATIC EXPLAINATION (1) @shivanipallela

追加: 2026-05-19

[00:00:00]Hello students, welcome back to our channel. So here in this video we are going to discuss the unit number two problematic explanation of the subject corporate accounting. In previous video we have already completed unit number one complete problematic explanation.

[00:00:19]Now here in this unit number two complete problematic explanation. I will give you a clarification and I will easily explain if you are having a new to this chapter also by watching this video you will easily understand. Okay.

[00:00:35]So unit number two name is amalgamation accounting standards 14. So this is the unit two you are having ma. So here also one theory one problematic we can expect or both the questions they will ask problematic only. So what is the problematic concepts we are having in unit number two? First one is [clears throat] in the nature of merger you are having. Second method is in the nature of purchase. That means amalgamation in the nature of merger.

[00:01:06]Amalgamation in the nature of purchase.

[00:01:09]Sometimes they'll ask problematic related to the merger. Sometimes they'll ask problematic related to the purchase.

[00:01:17]So here in this video we are completely discussing about the topic amalgamation in the nature of merger. In second video I will discuss the second topic. It is too problematic. You need to be perfect.

[00:01:32]If you are perfect with this two problematic easily you will attempt the problematic concept from unit number two. And when you understand merger you will easily understand purchase 90% it will be same only. So indirectly you are preparing perfectly one problematic only. Clear? So in this video unit two topic one problematic we are discussing that is amalgamation in the nature of merger. Okay. So this is the question. So what is the question?

[00:02:04]See problems on amalgamation in the nature of merger. Here in the question only you will able to find out whether they are asking in the nature of merger whether they are saying in the nature of uh purchase. See here A limited acquired the undertaking of B limited means A is acquired A is taking B limited on 31st March 2018 purchase consideration is 2 laks 50,000 what is this 2 laks 50,000 okay so each share is 10 rupees okay 250,000 uh total shares each share is 10 rupees clear Next the balance sheet of the two companies they have given A limited balance sheet B limited balance sheet balance sheet they have given see here pass the journal entries in the books of B limited when amalgamation is in the nature of merger see here they are saying no in the nature of merger okay they have said and prepare the balance sheet journal entries I will take it I will I will explain in others But here we need to understand how to do the balance sheet of merger. Okay. And also assuming that rebate reserve workman compensation fund of B limited are required to be continued in the accounts of A limited like whatever we are having rebate reserves and workmen that will be considered in A account only itself. So this is the question.

[00:03:37]Now here in this question they are asking journal entries and they are asking balance sheet but I am only discussing balance sheet. Why? Because journal entries after understanding the concept you can easily write the journal entries. There is not a big issue in that. Okay.

[00:03:52]So balance sheet also see here who is merging see A is merging with B and they are asking only balance sheet of A limited only A limited balance sheet they are asking no. So that's why particulars note number amount balance sheet of a limited okay balance sheet of rain limited how what will be there in the balance sheet means see here this is the prof you need to remember now okay what is the prof in the first one you will have equity and liabilities okay first concept is equity and liabilities in this equity and liabil Here it is. First one you are having shareholders funds. In this again shareholders funds you will have share capital.

[00:04:56]B1 is reserves and surplus.

[00:05:04]This is fixed proformer. Any question from unit number two of merger like this only the balance sheet will be okay second one you are having current liabilities current liabilities okay that's it then we need to do the total this is total of liabilities after that second one you will have assets okay this Equity and liabilities. This is assets. In assets, first one, you'll have non-current assets.

[00:05:45]In non-current assets, you will have fixed assets.

[00:05:56]Okay. Second one is current asset.

[00:06:03]In current assets also you'll have three things.

[00:06:08]One is inventories.

[00:06:13]Second one is trade receivables.

[00:06:19]Third one is cash and cash equivalents. That's it. Okay. Now do the total.

[00:06:30]This is total of assets. Okay. So this is the complete profarmama. Okay. So in any question like this you need to do it. Okay. Here I'm doing the working notes for this problematic. Okay. So how to do the solution? Okay. So simply see here they have given the data. Okay. So in the profarma what is the first one you are having share capital you are having okay what is the profarma you are having share capital so what is the share capital of a limited okay so here only we are doing the balance sheet of a limited no so a limited share capital is 2 lak 50,000 each share is 10 rupees so number of shares how you will calculate simple equal 250,000 divided by 10 how much it will be 25,000.

[00:07:35]So 2 lak 50,000 divided by 10 if you are doing means 25,000. Okay. And again purchase consideration 250,000 will be paid by the each shares. Again they are saying in the above the table no how much is the purchase consideration ma 250,000.

[00:07:56]What is the each shell again? 10 rupees.

[00:07:59]So same 2 lakh 2 lak 50,000 divided by 10. So 25,000. So two times we are having the share capital. So 250,000 divided by 10 250,000 divid by 10. So what is the share capital?

[00:08:17]Total 50,000.

[00:08:20]So 50,000 shares. Okay. Each share how much they are saying 10 rupees. So 50,000 into 10 you need to do it. 50,000 into 10 if you are doing means you are getting five lakhs.

[00:08:37]Okay. Where you'll write this five lakhs here in the share capital. Here we have done the working notes number one. No here we have done the working notes.

[00:08:48]in note number here I'm writing 1 five lakhs okay understanding so a limited shareholders number of shares and purchase consideration shares we have taken number of shares and we have multiplied with the 10 so we got total share capital is five lakhs next what you are having reserves and surplus so how to do this reserves and surplus means Simple thing here I'm doing working notes number two for reserves I'm doing no working notes is also important so simple thing what is the reserve you are having opening reserve is 1 lakh 20,000 B limited reserve is 29,000 so general reserve what we need to do 1 lak 20,000 is the A limited from that B limited we need to do minus so 1 lak 20,000 000 minus 29,000 if you are doing means you'll get 91,000 only.

[00:09:53]Okay. So this is general reserve comes under the reserves and again you're having development rebate reserve development rebate reserve will also reserve only. No. So development rebate reserve. So what is this? We need to do a limited is 10,000 plus we need to do.

[00:10:14]Okay. Okay, generalism always we need to do minus because it is decreased value.

[00:10:19]So general rebate is development rebate is plus. So 10,000 plus 37,000 it will become 47,000.

[00:10:29]Okay. Next what you are having workman compensation fund fund is also same thing. So workman compensation fund simple 15,000 is a plus 24,000 is b.

[00:10:46]So 15,000 + 24,000 is 39,000.

[00:10:54]Okay. So next profit and loss account.

[00:10:58]Profit and loss account will also comes here in the reserves only. So next what you are having profit and loss account.

[00:11:05]When you are taking profit and loss account, we need to take only 10,000.

[00:11:08]Why only 10,000? Why not B1? Means we are doing only balance sheet for A limited. So that's why we need to do only the profit and loss account of A limited. What is that? 10,000.

[00:11:23]So that's it. Okay. Now do all the things. So 39,000 + 10,000 + 47,000 + 91,000.

[00:11:33]How much you're getting? 1 lakh 87,000.

[00:11:36]This is the total amount. So you need to write it here in the reserves working notes number two 1 lak 87,000.

[00:11:46]Clear? Next. Next what you having?

[00:11:50]Current liabilities. No. What is the current liabilities? You are having 45,000 and 95,000. Yes. So how you'll do this working notes number three you are doing for the current liabilities that means how much is the amount you are having mark 45,000 + 95,000 so 45,000 + 95,000 simply we need to add it so 45,000 + 95,000 is 1 lakh 40,000 so where you'll write here in the current liabilities working notes number three so one lakh 40,000 clear after doing this now nothing is left over share capital is over equity shares is over general reserve penal account rebate workman composition fund of current liability everything is over in the liability side just do the total 5 lakhs plus 1 lak 87,000 plus 1 lakh 40,000 how much it will be 8 lakhs 27,000 you'll Okay.

[00:12:58]So 5 lakhs plus 1 lakh 87,000 plus 1 lakh 40,000 8 lakhs 27,000 is the answer of current of total liabilities. Now same here in the asset side also simply fixed assets you need to take it aside. What is the fixed asset? Land and buildings, plant and missionary, furniture and fittings.

[00:13:22]These three are the fixed assets. No. So fixed assets I'm doing the calculation working notes number four. So here I'm doing the fixed assets. So fixed assets calculation. What is the fixed assets?

[00:13:33]We are having land plant plant furniture. So land plant plant furniture. These all three are the fixed assets. No. What is the opening and closing? Land is 1 lakh 20 and 80. So 1 lakh 20,000 plus 80,000 plant is 2 lakhs plus 1 lakh 80,000.

[00:14:02]Next furniture is 10,000 + 20,000.

[00:14:10]This will become 2 lakhs.

[00:14:13]This will become 3 lakh 80,000. This will become 30,000. So what is the total fixed assets? So 2 lakhs plus 3 lak 80,000 plus 30,000. So 6 lakhs 10,000 is the total fixed assets. So directly here I'm writing 6 lakhs 10,000. Clear?

[00:14:35]Understood? Next what you are having inventories. Inventories is nothing about the stock. What is the stock? we are having 55,000 plus 40,000. So here I'm doing the working notes number five for stock or inventories. How much you're having? 55,000 plus 40,000. So how much it will be?

[00:14:59]95,000.

[00:15:01]Okay. Here I'm doing working notes number five. No. So 95,000.

[00:15:06]Next trade receivable. Trade receivable is nothing about datas. what you are having 45,000 + 40,000 this is working notes number six so trade receivables I'm doing what is the amount you are having 45,000 plus 40,000 so how much it will be 85,000 so this is working notes number six 85,000 next last one you are having bank that is cash or cash equivalent so 20,000 plus 17,000 this is working notes number seven cash and cash equivalence I am doing. So what is the amount? 20,000 plus 17,000 it will be 37,000.

[00:15:51]So where you'll write this? This is working out number 7 37,000.

[00:15:56]So you need to merge everything and you need to show it like this. So when you are adding all this 6 lakh 10,000 + 95,000 sorry 6 lakhs 10,000 plus 95,000 + 85,000 + 37,000 how much it will be 8 lakhs 27,000 like this it should get tallied simple thing you need to remember they'll give two companies you need to merge the two companies amounts under which it will come in assets whether Whe it is a fixed asset whether it is a current asset in current asset what it will come in liabilities it is a share capital reserves current liabilities are non-current liabilities are like this you need to add it you need to segregate the items where it will come that's it so like this you need to do the amalgamation in the nature of merger here A is merging with the B company no so working notes is important proarma is important note number is important whatever you have done the working notes you need to show it in the note number after completing all the solution like this your answer should get tallied okay this is the first question I have done for better understand clear understood okay next we'll do the another question now see the next question this is the second question we are discussing in the nature of merger for better understanding so see here the following figures related to the hero limited and Honda limited There are two different companies now. So on 31st March 2018 who are agreed to amalgamate in heroown company means two companies are merging together and forming a hero Honda limited. Okay. They have given the liabilities they have given the assets assuming that goodwill of her limited and Honda limited is 56,5,800.

[00:17:54]So work out the amalgamation should be there and we are having that uh the investments also 54,000 and 38,000 past necessary journal entries and along with the show the initial balance sheet. So here they are amalgamating. Amalgamating is nothing about hero company is comp like merging with Honda company and forming a hero Honda limited. Okay. So how to do this kind of solution? This is also in the nature of merger only. Okay.

[00:18:25]So simple thing first what we will write? We will write the balance sheet of Hero Honda Limited. No. So first what you will have equity and liabilities.

[00:18:34]Yes. So here I'm writing equity and liabilities.

[00:18:41]In equity and liabilities what is the first one you are having? Share capital.

[00:18:49]Second one what you will have my reserves and surplus.

[00:18:56]Okay.

[00:18:59]First what you are having share capital and reserves and surplus. Now to do this share capital what we need to do directly we should not take capital we need we should not add like this. So to do the share capital we need to calculate the purchase consideration. So how to do this calculation of purchase consideration means see here. So here I'm writing calculation of purchase consideration.

[00:19:25]Okay this is a working notes now compulsory you need to do it in the examination also. So how to do this purchase cons? consideration means how many uh accounts you are having. Hero limited you are having. Okay.

[00:19:40]Honda limited you are having for both you need to do the purchase consideration. Okay. So what is the formula of purchase consideration? Total assets minus liabilities.

[00:19:52]So first we will take the assets part.

[00:19:54]Ma'am what is the assets we are having in the question? fixed assets you are having 5 lakh 55,200 Honda committed Honda limited company fixed assets you are having 2 lak 97,800 so here I'm writing fixed assets 5 lakh 55,200 2 97,800 okay actually sorry for the background disturbance now just try to understand the concept so to do this purchase consideration we need to do the total assets minus current liabilities. So fixed assets we are having 5 lakh 555,200 for Hilo Limited. Honda limited is 2K 97,800.

[00:20:36]Yes. Next stock is also we are having.

[00:20:39]So here I'm telling stock 3 lakh 12,200 2 lakhs 14,200 next book debts. Okay. Next what you are having book debts. So that is also we are having. So book depths is also an asset. So 2 lakhs 47,800 and 1 lak 70,400.

[00:21:05]Next investments 60 and 40. But see here in the adjustment part the investment of Hero Limited and Honda limited are valued. So when they are giving the assets in the table and assets in the adjustment part you need to take the amount in the adjustment part only. So investment you should not take the table value you should take this value because this is revalued. So 54,000 and 38,000 we are taking. Okay. Next what you are having now cash is also an asset. So what is this? 36,800 19,600.

[00:21:41]Next what you are having goodwill is also asset but they have given in the adjustment part. Even though if they are giving in the adjustment part we need to consider it as an asset only. So goodwill is also an asset. No. So goodwill what is the goodwill amount we are having? 56,000 for the hero limited 55,800 is the Honda limited like this we need to do all the assets. So do the total assets now. So if you are adding all these mean 5 lakh 55,200 plus 3 lakh 12,200 plus 2 lakh 47,000 uh uh 1 minute 5 lakh 55,200 3 lakh 12,200 2 lakh 47,800 plus 54,000 + 36,800 + 56,000 If you are doing means you're getting 12 lakh 62,000 of Hero Limited total assets. Same like that Honda Limited also 2A 97,800 plus 2 lakh 14,200 plus 1 lakh 70,400 plus 38,000 plus 19,600 + 55,800.

[00:22:56]If you are doing mean what you are getting 7 lakh 95,800 from this we need to deduct the liabilities. So here I'm doing minus liabilities.

[00:23:11]So what is the liabilities we are having? Ma capital you should not take it. Profit and loss account you should not take it. Any reserves also you should not take it. Only you need to take the current liabilities like for example credits, bills payable, bank overdraft this kind of stuff if you are having in the liability set you need to take it. So we are having only credits.

[00:23:30]No. So we need to deduct this citors. So what is the credits of Hero and Honda limited ma'am? So 1 lak 52,000 is for the Hero Limited. 2 lakhs 2,000 is for the Honda Limited. What we need to do?

[00:23:44]We need to deduct this. Then you'll get the purchase consideration. That means 7 lak 95,800 minus 2,000. If you're doing means 5 lak 93,800 is the answer. Same here also 1 lak 26,200.

[00:24:02]Sorry 12 lakh 62,000 minus 1 lakh 52,000 if you are doing means you're getting 1 lakh sorry 11 lakhs 10,000 you'll get so like this you need to calculate the purchase consideration of the companies so this purchase consideration whatever we got for her limited and Honda limited that we will write it here in the share capital how you'll write it ma'am simply add this both that means level l 10,000 plus 5 lakh 93,800 if you are adding this two means how much you are getting 17 lakhs 3,800 so here I'm writing 17 lakhs 3,800 in every question okay in every question if the question is like this in the nature of merger means whatever the purchase consideration we got for the both the companies no that purchase consideration we need to write it in the share capital. Okay. So like this you need to do the adjustment part. Clear?

[00:25:07]Understood? So simple, easy and it will be very easy to understand also. Clear?

[00:25:14]Next reserves and surplus. We are not having any reserves here. Only profit and loss account we are having. But profit and loss account we will not take it here in the reserve part. So if they are having general reserve then we will take it.

[00:25:27]But when we are both the companies is merging no that time we will not take any reserves and surplus. So second part in liabilities what you are having current liabilities no. So what is the current liabilities you are having? No only credits you are having. No. So here I'm writing credit hours. So what is the credit you are having? 1 lakh 52,000 plus 2,000. So 1 lak 52,000 plus 2,000.

[00:25:53]If you are adding together 1 lakh 52,000 plus 2 lakh 2,000 means you are getting 3 lak 54,000 you are getting. So this is the only liabilities part you are having. Capital already we have taken profit and loss we should not take it.

[00:26:08]Cratas we have taken only this three parts you are having. Just do the total of total liabilities. So total liabilities you'll get like around um plus 17 lakhs 3,800 if you're doing mean 20 lakhs 57,800 is the final answer. Okay. Same way second part what you will have my assets. In assets what you will have in assets? First you'll have non-current assets. So non current assets. Same like previous one only. In non-current assets what you'll have fixed assets. First you'll have the fixed assets. So here directly they have given the fixed assets. That means 5 lakh 55,200 plus 2 lak 97,800 this both we need to add it 5 lak 55,200 plus 297,800 if you are adding means you'll get 8 lakh 53,000 you will get it okay this is called fixed asset so second one intangible asset intangible asset what you will have goodwill you will have no so what is the goodwill they have given ma so goodwill I have given 56,000 and 55,800 that also you need to add it. So 56,000 + 55,800.

[00:27:29]So 56,000 + 55,800 if you are doing means you are getting the value of 1 lakh,800.

[00:27:38]Okay, this is goodwill part. Goodwill is also over. Next what is left over?

[00:27:42]Stock. Stock will come here in the current assets. No. So here I'm writing current assets. Same like previous one only. Okay. Everything will be same.

[00:27:50]Stock is nothing about the inventories.

[00:27:54]Okay. So inventories you will call it as a stock. No. So inventories here I'm writing stock. What is the stock value are having? 3 lak 12,200 plus 2 lak 14,200.

[00:28:09]Simply I'm adding this two. Okay. So 3 lakh 12,200 plus 2 lakh 14,200 how much it will be 5 lakh 26,400 okay next what you are having book debts book debts is nothing about trade receivables trade receivables is also known as the datas no so trade datas is also known as trade receable so that will be considered as 2 lakh 47,800 plus 1 lakh 70,400 yes 2A 47,800 plus 1 lakh 70,400 so it will be 4 lakhs 18,200 like this okay next what you are having investments you are having so investments how much you are having 60,000 plus 40,000. So total it will be 1 lakh.

[00:29:16]Next cash and cash equivalence. So cash and cash equivalence you are having 36,800 plus 19,600.

[00:29:24]So say 36800 and 19,600 it will be 56,400.

[00:29:32]But the thing is investment they have given the below value no revalued value they have given that only we need to take it like 54 and 38 instead of 60 and 40 we need to take 54 and 38. So when they are giving the adjustment part you need to consider that only that means 54,000 plus 38,000 like this you need to take it. If again in the adjustment part if they have not given directly table value only we will take it but adjustment they have given noa. So that means 54,000 plus 38,000 you need to take it. How much it will be? 92,000. Now everything is done. Just do the total of assets. It should get tallied. Okay. That means 8 lakh 53,000 plus 1 lakh 11,800 plus 5 lakh 26,400 plus 4 lakh 18,200 plus 56,400 plus 92,000. How much it is there? 20 lakhs 57,800.

[00:30:35]So total assets is 20 lakhs 57,800 and total liabilities is also 20 lakhs 57,800.

[00:30:43]Simply we have combined both the values like Hero Limited and Honda limited we have combined it and that is the only thing we have done here in share capital we have calculated purchase consideration. Okay, that is the only thing we have done.

[00:30:58]So like this you need to do the merger question clear. I hope you have understood. If you are not understanding no again you rewatch the explanation you will easily understand what I am explaining. Okay. So like this you need to do the solution. Next question also I'll explain. See here directly they have given neatly they have given here.

[00:31:21]So what is they have given share capital they have given reserve fund. They have given profit and loss account. they have given and creatas and bills payable they have given okay they have given assets also fixed assets and current assets they have given simply we need to do the uh passing the we need to do the CS company C is another company S is another company both are amalgamating that is both are merging together we need to show the balance sheet how you'll show the balance sheet simple simply we need to add where it will come what is the first thing you'll have equity and liabilities no so equity and liabilities.

[00:31:59]Sorry, sorry, sorry.

[00:32:09]In equity and liabilities, first you'll have shareholders fund.

[00:32:16]Okay? In shareholders fund again you'll have share capital.

[00:32:23]What you'll do the share capital simply we need to add it. So that means 50,000 five lakhs and three lakhs. So total it will be 5 + 3 is 8 lakhs. So 5 lakhs + 3 lakhs is 8 lakhs. Simply we need to do it. Okay.

[00:32:42]Next reserve fund also reserve what you'll do 2 lakhs plus 2 lakh 50,000 total it will be 4 lakh 50,000 next profit and loss account will also comes here no so here I'm writing profit and loss account so directly be I'm writing here so it is 90,000 okay next cas and bills payable comes here in the current liabilities so here I'm writing current liabilities ities.

[00:33:14]Okay. How you'll do this current liabilities? You're having creditors and bills payable. So 225,000 plus 1 lakh 55,000.

[00:33:30]So see 2K 25,000 plus 1 lakh 55,000. If you are doing this you are getting 380,000.

[00:33:37]That's it. Now do the total. So 3 lakh 80 plus 90,000 plus 4 lakh 50,000 plus 8 lakhs. So 17 lakhs 20,000 is the total liabilities.

[00:33:56]Okay. Now in the asset side second one what you are having my assets.

[00:34:03]In assets what you'll have non-current assets. First you'll have non-current assets. In non-current assets what you'll have first one fixed assets. So what is a fixed assets here? Goodwill is an intangible asset. Land and patents is a fixed assets. So land and patents here I'm doing the working notes. Now for fixed assets for better understanding.

[00:34:25]So see here the working notes. What is the land? We are having 6 lak 70,000 plus 5 lakh 20,000. Okay. Next patents you are having 1 lak 60,000 plus 1 lak 5,000 okay so what will be the total 6 lak 70,000 sorry plus 5 lakh 20,000 it will be 11 lakh 90,000 next 1 lak 60,000 plus 1 lakh 5,000 it will be 265,000 so 265,000 plus 11 lakh 90,000 is 14 lakhs 55,000.

[00:35:08]So total fixed assets is 14 lakhs 55,000. So here I'm writing working notes number one 14 lakhs 55,000. Okay, you can do working notes for this also not an issue. Next you are having intangible asset. No intangible is nothing about goodwill.

[00:35:25]Here I'm writing goodwill. Okay, simply we need to add the goodwill. So 1 lakh plus 80,000. So total it will be 1 lak 80,000.

[00:35:35]Next you are having current assets.

[00:35:40]Current assets what you are having my bills receivable. Bills receivable will comes here in the trade receivable. No.

[00:35:48]So trade receivable. So 20,000 plus 15,000. So it will be 35,000.

[00:35:56]Next you are having cash and cash equivalence. That means bank 25 + 25 it will be 50,000. So like this you need to add where it will come. You need to merge that both the values. Now do the total 14 lakh 55,000 plus 1 lakh 80,000 + 50,000 plus 35,000 like this you need to do it. So how much you're getting? 17 lakhs 20,000. That's it. Okay. So this is the way you need to do the solution.

[00:36:26]So both are tally. Okay. Simply where we need to get where we will enter all the things that you need to do it. That's it. Okay. Now here I have given the homework sama here. So this both the questions you do it as the homework and let me know your final answers in the comment section. This is the first question and take a screenshot. This is the second question. These two questions you need to do the homework. So as of now we have discussed the first part that is in the nature of merger. We have discussed amalgamation. In the nature of merger we have completely we have discussed clear. So let me know in the comment section whether the explanation is understanding or not you are having any difficulty in understanding let me know in the comment section. So better to prepare problematic from this unit rather than theory amalgamation in the merger and purchase compulsory one problematic every year they are asking sometimes both are problematic only they are asking. So that's why problematic is non-negotiable. You should not skip that. here. All the very best. See you all in next video. This notes PDF is available in our telegram group for free of cost. All the links I have mentioned in the description box. See you all the next video for the topic number two.

[00:37:38]After watching this, please watch topic number two also. If you are watching two topics only, then you'll complete unit number two problematically. So that's it about the video. See you all in next video students. Bye-bye everyone.