68 Advanced Corporate Accounting 4. Spring Field Ltd. is absorbed by Sports Field Ltd., the consideration being: 1. The taking over of the trade liabilities of 740,0003; 2. The payment of cost of absorption of 15,0003; 3. The repayment of B' debentures of Spring Field Ltd. of 2,00,000 at par, 4. The discharge of 'A' debentures of 3,00,000 in the Vendor Co. at n premium o of 8% debentures in Sports Field Ltd. at par, 5. A payment of 20 per share in cash and the exchange of 4 fully paid 10 sha Ltd. at a market price of 15 per share for every 50 share in Spring Field Ltd. v in number.
68 Advanced Corporate Accounting 4. Spring Field Ltd. is absorbed by Sports Field Ltd., the consideration being: 1. The taking over of the trade liabilities of 740,0003; 2. The payment of cost of absorption of 15,0003; 3. The repayment of B' debentures of Spring Field Ltd. of 2,00,000 at par, 4. The discharge of 'A' debentures of 3,00,000 in the Vendor Co. at n premium o of 8% debentures in Sports Field Ltd. at par, 5. A payment of 20 per share in cash and the exchange of 4 fully paid 10 sha Ltd. at a market price of 15 per share for every 50 share in Spring Field Ltd. v in number.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
100%
![CE
68 Advanced Corporate Accounting
Spring Field Ltd. is absorbed by Sports Field Ltd., the consideration being:
1. The taking over of the trade liabilities of 740,000;
2. The payment of cost of absorption of 15,000;
3. The repayment of B' debentures of Spring Field Ltd. of 2,00,000 at par,
4. The discharge of 'A' debentures of 3,00,000 in the Vendor Co. at n premium of 10% by the issue
of 8% debentures in Sports Field Ltd. at par,
5. A payment of 20 per share in cash and the exchange of 4 fully paid 10 shares in Sports Field
Ltd. at a market price of 15 per share for every 750 share in Spring Field Ltd. which were 40,000
4.
Profit after ta
1991
1990
1989
Gioodwill may be taken at 4 years
basis of 10% normal trading prot
amalgamation of both companies
in number.
You are required to find out the purchase consideration.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc78e6e24-37f9-468f-80d2-cd69137d58d1%2Faacb4d19-57a3-4167-b7ea-0aaa2378c17b%2Fhdclc2g_processed.jpeg&w=3840&q=75)
Transcribed Image Text:CE
68 Advanced Corporate Accounting
Spring Field Ltd. is absorbed by Sports Field Ltd., the consideration being:
1. The taking over of the trade liabilities of 740,000;
2. The payment of cost of absorption of 15,000;
3. The repayment of B' debentures of Spring Field Ltd. of 2,00,000 at par,
4. The discharge of 'A' debentures of 3,00,000 in the Vendor Co. at n premium of 10% by the issue
of 8% debentures in Sports Field Ltd. at par,
5. A payment of 20 per share in cash and the exchange of 4 fully paid 10 shares in Sports Field
Ltd. at a market price of 15 per share for every 750 share in Spring Field Ltd. which were 40,000
4.
Profit after ta
1991
1990
1989
Gioodwill may be taken at 4 years
basis of 10% normal trading prot
amalgamation of both companies
in number.
You are required to find out the purchase consideration.
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education