Payable relating Acquisition of Shares

Bhagavan (Team Lead) (36 Points)

07 June 2009  

Hi,

I have one doubt here the company purchased Shares of X company from Mr Y on 20th March 2009 for Rs10 laks, by paying cash of Rs 6 laks and Rs 4 laks as credit payable with in 1 month. Now the company pays Rs 4 laks on 19th April 2009 (New FY), As per AS 3 this transaction has to be recoreded in Investing Block of Cash Flow Statement.

As an Analyst do we need to consider the Rs 4 laks as Purchase of Investments or Repyment of liability.