17 May 2008
Adjustment:A and B cos are going to get amalgamated,to form AB Ltd, there is a contingent liability in the books of A Ltd;worth Rs 60,000.The question is asking us to treat this as a actual exsisting Liability .How do we account this in the books of A Ltd;and also in the books of AB Ltd.
17 May 2008
1. The contingent liability is towards what? 2. If it is not relating to B, you can make a provision in the Books of A and then on merger it automatically comes to AB.
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