Question

Akshita Ltd. issued fully paid shares of ₹ 5,00,000 in purchase consideration of net assets of ₹ 4,70,000. The balance of ₹ 30,000 will be ______ to ______ account.

Options

• debited, Goodwill

• debited, Capital Reserve

• credited, Capital Reserve

• credited, General Reserve

Answer 1

Akshita Ltd. issued fully paid shares of ₹ 5,00,000 in purchase consideration of net assets of ₹ 4,70,000. The balance of ₹ 30,000 will be debited to Goodwill account.

Explanation:

Purchase Consideration = ₹ 5,00,000 and Net Assets = ₹ 4,70,000. Since purchase consideration exceeds net assets by ₹ 30,000, the difference is treated as Goodwill and debited.