HIJ and KLM exchanged equity interest resulting to HIJ obtaining control over KLM. Relevant information follows: HIJ (before combination) Consolidated Identifiable assets 2,200,000.00 3,600,000.00 Goodwill Total Assets 2,200,000.00 ? Liabilities 700,000.00 1,300,000.00 Share Capital (P20 par) 800,000.00 976,000.00 Share Premium 300,000.00 1,092,000.00 Retained Earnings 400,000.00 Total Liabilities and Equity 2,200,000.00 Requirements: Compute for the Goodwill or (Gain on Bargain Purchase).
Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
What is the
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